dYdX raises margin requirements in some markets, bans “highly profitable trades”


Decentralized crypto change dYdX has disclosed new measures to mitigate trading-related dangers after burning $9 million of its insurance fund on Nov. 17 to cowl customers’ losses.

In keeping with an announcement on X (previously Twitter), the change elevated margin necessities on a number of “much less liquid markets,” affecting tokens equivalent to Eos (EOS), 0x Protocol (ZRX), Aave (AAVE), Algorand (ALGO), Web Pc (ICP), Monero (XMR), Tezos (XTZ), Zcash (ZEC), SushiSwap (SUSHI), THORChain (RUNE), Synthetix Community Token (SNX), Enjin Coin (ENJ), 1inch Community (1INCH), Celo (CELO), Yearn.finance (YFI) and Uma (UMA).

DYdX triggered its insurance coverage fund to cowl customers’ buying and selling losses on Nov. 17 after a worthwhile commerce concentrating on lengthy positions on the YFI token brought on the liquidation of positions value almost $38 million.

DYdX founder Antonio Juliano dubbed the transfer a “focused assault” on the change. In keeping with him, YFI’s open curiosity in dYdX spiked from $0.8 million to $67 million in a matter of days because of the actions of 1 particular person. The identical particular person, in line with Juliano, tried to assault the SUSHI market on dYdX just a few weeks earlier.

“We did take motion to extend preliminary margin ratios for $YFI previous to the worth crash, however this was in the end not enough. The actor was capable of withdraw a great quantity of $USDC from dYdX proper earlier than the worth crash,” he wrote.

On X (previously Twitter), the change’s staff stated that “extremely worthwhile buying and selling methods have now been banned on dYdX,” in reference to the language used by Mango Markets’ exploiter Avraham Eisenberg in his $116 million assault of 2022.

DYdX is now providing a bounty fee in change for precious data.

The YFI token declined by 43% in just a few hours on Nov. 17 after hovering over 170% in November. The sharp decline worn out over $300 million in market capitalization from the latest good points, according to knowledge from CoinMarketCap. Previously 30 days, nonetheless, the token has nonetheless gained over 90%, buying and selling at $9,190 on the time of writing.

The Yearn.finance staff hasn’t disclosed any official particulars in regards to the incident. A supply conversant in the matter instructed Cointelegraph that builders on the staff don’t management the vast majority of the token provide, strongly refuting preliminary considerations a couple of potential rip-off. The declare is supported by Etherscan knowledge showing massive centralized exchanges as YFI prime holders.

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