Bitfinex Accused of Price Manipulation After Abrupt System Switch Off
Users asked why the firm has only one server that was restarted in order to avoid loss of data. The cloud hosting provider has also been on the spot for the switch off.
Bitfinex Goes Dark For an Hour
Bitfinex has come under scrutiny over allegations of manipulations. This is after the leading global crypto exchange on Friday switched off its system for a period of 60 minutes. While announcing that all services had resumed, the platform explained that the switch off was due to a
‘Service Disruption Post Mortem.’
The announcement was made through a series of tweets, with clients alleging that the sudden switch off led to manipulation of figures. The development at Bitfinex followed another development at BitMEX. BitMex was recently forced to liquidate its shorts after an attack.
Bitfinex claimed there were connectivity challenges on one server. The switch was then initiated as a precaution. The firm promised users that everything was being done to ensure that operations resumed immediately. The exchange pointed a finger at its cloud hosting service provider. According to Bitfinex, the provider had allegedly restarted its matching engine server without prior warning. It resorted to restart its servers which temporarily closed the trading for 60 minutes. The resumption of trading was announced alongside an apology note.
In a blog post, the firm announced that the affected server was the core of its entire system. During the switch off no data was lost but any pending ques was pushed to the database.
Before the switch off, Bitcoin was trading below $700 and upon resumption, it was valued at $6,910 at 6 14:55 UTC. Notably, the switch off coincided with the expiry of CME Futures Contract.
Upcoming API Upgrade
Traders wondered why the platform had only one server while at the same coinciding with the expiry. The firm was urged to investigate the issue to rule out any chances of manipulation. However, many users congratulated Bitfinex for communicating throughout the outage.
The shut-down came days after the platform announced that there will be an API upgrade on 15th September. During the upgrade, a number of changes will be conducted on the platform. At the time, servers will only permit a maximum number of 250 subscribers.