Key facts
- A trader claims to have lost over $5 million in USDT due to AKEUSDT perpetual futures trading on Binance.
- The trader alleges the losses were caused by a market manipulation event, specifically a short squeeze.
A trader alleges over $5 million in losses from AKEUSDT perpetual futures on Binance, citing a short squeeze. Binance denies system failure, stating its pricing model and liquidation systems functioned properly and blamed the losses on market volatility.
This incident highlights the risks of leveraged trading in volatile crypto markets and raises questions about market integrity and exchange accountability, potentially impacting investor confidence in Binance.
Binance is facing scrutiny after a trader reported losses exceeding $5 million in the AKEUSDT perpetual futures market, alleging market manipulation. The trader claims the price of AKE surged dramatically before liquidations occurred, suggesting a coordinated short squeeze. Binance, however, has refuted these claims, asserting that its trading systems and liquidation processes operated correctly during the incident.
The exchange clarified that the AKEUSDT futures contract's pricing is determined by data from multiple external spot markets, a mechanism designed to prevent abnormal price impacts from a single venue. Binance's support team stated that their internal review found no issues with their pricing model or liquidation system, attributing the losses to the inherent risks of leveraged trading in volatile conditions.
The aggrieved trader pointed to a prior liquidation event involving TUT, where affected users reportedly received compensation from competing exchanges. Binance, in contrast, maintains that the AKE incident was a consequence of market risk and not a trading error on its part. Public market data confirms significant price volatility for AKE on September 3, though aggregated spot charts showed a peak lower than the contract price mentioned by the trader, a discrepancy that remains unexplained.