A relatively unknown gaming token, VOXEL, went up by more than 50% in the past 24 hours after a malfunction on BitGet caused the VOXE/USDT perpetual contract to surpass that of Bitcoin. The incident has raised concerns about market manipulation on centralized exchanges.
According to reports, the incident led to VOXEL/USDT 24-hour trading volume to soar to $12.72 billion, far above Bitcoin’s $4.76 billion trading volume within that period. While some believe it could be due to market manipulation, crypto analyst Dylan believes it is likely due to a bug in the exchange trading bot.
Although the issue is now under control, some users could profit from the incident once they discovered that the bot executed trades between $0.125 and $0.138. Dylan noted that some users made six-figure profits using just $100.
While the issue is now under control, CoinMarketCap data shows that VOXEL is trading at $0.09131, 40% higher than its value earlier today. However, it has fallen from its peak of $0.1645.
Voxel is the in-game token for blockchain-based game Voxie Tactics, and it is tradable on several exchanges. The token has a market cap of just $23 million, and 79% of its total 300 million token supply is already in circulation.
BitGet says the incident is under investigation
Meanwhile, BitGet has acknowledged the abnormal trading and is investigating the incident. The exchange spokesperson Xie Jiayin said on X that the issue did not affect any other functions on the platform.
He said:
“We will synchronize more specific information as soon as possible. Some users may be subject to risk control. If you have any questions, please contact the online customer service in the App. Currently #Bitget trading, deposit and withdrawal functions are all normal.”
The spokesperson added that every platform experiences issues and challenges such as this during its development phase, but how they resolve those matters is key. He promised the investigation report would be available within 24 hours.
Nevertheless, the exchange has temporarily suspended all these functions for some accounts it claimed engaged in market manipulation during the incident. An update from BitGet claimed that this market manipulation triggered its risk control systems.
It said:
“Certain accounts were found to have potentially engaged in market manipulation, triggering our risk control system. Affected accounts have been temporarily suspended from trading, deposit, and withdrawal functions.”
The exchange added that it would restore the function for these accounts over the next 24 hours and roll back all the irregular trades that occurred within that period. Those who traded the VOXEL/USDT contract within that period will receive compensation.
Crypto community criticizes BitGet
However, the decision to temporarily suspend function for accounts, unilaterally roll back profits, and forcibly settle VOXEL positions has attracted criticism from many who believe it sets a dangerous precedent.
One user, Cody, said the exchange handling of the incident was immature and unprofessional, while also criticizing its hybrid custodial risk pool.
He wrote:
“Its handling of VOXEL incidents was immature, unethical, and unprofessional, resulting in user losses and raising serious doubts about its integrity.”
Cody’s comment appears to be aimed at BitGet CEO Gracy Chen, who criticized decentralized exchange Hyperliquid with similar statements a few months ago. However, it echoes the opinion of many users who believe the exchange is blaming them for its fault.
One user noted that retail users did not manipulate the market, and the issue was clearly from the market makers. They warned BitGet that it could lose users because of how it handled the incident.
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