Crypto.com was one of the few crypto exchanges to keep LUNA exchanges open as Terra’s death spiral saw an unrecoverable price crash of LUNA and UST stablecoin. However, a technical glitch on Crypto.com’s mobile app allowed users to momentarily get away with a 30-40x profit on LUNA trades.
On Friday, Crypto.com abruptly banned users from trading after an internal tool detected the system quoting incorrect prices for LUNA due to an error. Just as Crypto Twitter began raising concerns about trade reversals on the exchange, Kris Marszalek, CEO of Crypto.com, revealed details of a glitch that allowed users to make huge profits.
There were a lot of customers buying at the wrong prices and of course some also jumped at the chance to exploit the glitch to the fullest.
We have reversed ALL trades.
Some customers have saved a ton of $ and thank us, some have not abused the glitch and are bashing us.
—Kris | Crypto.com (@kris) May 13, 2022
According to Marszalek, users who traded “during those 59 minutes” are eligible for a buy-back option at the market price of LUNA tokens, which has since fallen to $0.0004685 at the time of writing. Importantly, LUNA reached its all-time high market price of nearly $120 on April 5.
Marszalek noted:
“The root cause was a combination of several external factors (changes in tick size due to Luna’s death spiral, pullbacks and shutdown of the entire Luna chain) together leading to price dislocations which should generally be considered by index pricing, but have not been.”
After a day of reviewing the LUNA business debacle, Marszalek informed that “all user accounts have been reactivated.”
As Crypto.com canceled LUNA transactions, the company offered $10 worth of its internal Cronos (CRO) token as a goodwill gesture for affected investors.
Related: Breaking: Terra blockchain officially shut down following LUNA price crash
With LUNA’s price collapsing by over 99%, Terra blockchain validators officially shut down the network in an effort to prevent governance attacks.
The Terra blockchain has been officially halted at a block height of 7603700.https://t.co/squ5MZ5VDK
Terra Validators have decided to shut down the Terra Chain to prevent governance attacks following serious $LUNA inflation and a greatly reduced attack cost.
— Terra (UST) Powered by LUNA (@terra_money) May 12, 2022
Validators should only relaunch the network after implementing a new patch to disable additional delegations.
Patch version released: https://t.co/BZ8t86cuwA
Delegations will be disabled once block production resumes.
The network should go live once 2/3 of the voting power is online. An update will be provided accordingly. https://t.co/vffpjw7uom
— Terra (UST) Powered by LUNA (@terra_money) May 12, 2022
