The events of the last weekend have left a lot of Crypto.com users confused. The mobile app suddenly started displaying asset prices as being much higher than their actual market price. An internal system tool detected incorrect prices for LUNA, which some customers were able to exploit to turn 30-40x profits.
Confusion Amid LUNA & UST Crash
Crypto.com is one of the few crypto exchanges that kept Terra (LUNA) operations online following the extreme crash of the UST stablecoin, which is pegged to LUNA.
Soon after the internal tool detected the inaccuracy in the price of LUNA, Crypto.com barred their customers from performing any trades. The glitch lasted 59 minutes, during which some clients made away with massive profits. Crypto.com CEO Kris Marszalek later explained that the technical glitch only appeared on the mobile app, not on the exchange itself. Goin into more detail, Marszalek said: “The root cause was a combination of multiple external factors, for instance, tick size changes due to Luna death spiral, withdrawal & entire Luna chain stopping, leading to price dislocations.”
The root cause was a combination of multiple external factors (tick size changes due to Luna death spiral, withdrawals & entire Luna chain stopping) together leading to price dislocations that should typically be caught by index pricing, but weren't.— Kris | Crypto.com (@kris) May 13, 2022
Cronos (CRO) also in the Red After Reaching ATH
Surprisingly, the sudden collapse of the algorithmic stablecoin comes just one month after Terra (LUNA) reached its ATH of $119 on April 5th. In the aftermath of the glitch, Kris Marszalek has issued a buyback option at LUNA’s current price, which is $0.0001795 at the time of writing, for any users who traded assets in the 59 minute period.
Additionally, Marszalek also offered a gift of $10 in Cronos (CRO) as a gesture of goodwill. It is worth noting that Cronos, Crypto.com’s native token, is also experiencing hard times, with CRO trading at $0.199937 at press time, according to CoinGecko. CRO reached its pinnacle 6 months ago to trade at $0.96 after Crypto.com acquired the naming rights to the formerly known Staples Center.
On the Flipside
Last week, Terra halted its blockchain network as a means to prevent governance attacks. Although Do Kwon’s rescue plan managed to push the UST back up to $0.84, the patch was short-lived and the UST is hovering on a knife’s edge at $0.10, having bounced back from an all time low of $0.04495 just 4 days ago.
2/ It has been inspiring to partake in the dynamic discourse regarding the best next steps for Terra. Taking feedback from the community and thoughtful proposals, I would like to suggest the following for the path forward.https://t.co/E13VI8bkLh— Do Kwon 🌕 (@stablekwon) May 16, 2022
A thread on our reasoning: