Korean Crypto Exchange Crashes After Rise of Bitcoin Cash
Bithumb is the first and largest cryptocurrency exchange in Korea, regarding trading volume. Due to a recent increase in the number of users, the official website of Bithumb experienced an unexpected server outage.
Price Volatility & Bitcoin Cash
When prices decline, demand skyrockets as eager investors attempt to capitalize on the drop in price. Moreover, when prices are high, investors sell their assets and turn out a pretty profit. These maneuvers are especially true in the crypto world.
Whether it be the introduction of a new ICO, a bullish comment from a bank CEO, or political disputes within crypto communities, many factors can disrupt the price of a digital currency.
In the wake of abandoning the SegWit2x update, the price of bitcoin cash rose dramatically from $600 to a high of $2,600. To capitalize on this steep increase, investors swarmed the Seoul-based exchange.
Consequently, the bitcoin exchange went down with server connection failure over the weekend and users were unable to make deposits and withdrawals for two hours on Sunday evening. Bithumb released a statement on the subject and outlined the massive influx of users at the site while also apologizing for the outage on its website.
Overall, the trading volume was about 800 percent higher than the October average, as prices in some virtual coins experienced wild fluctuations.
Legal Proceedings
In some cases, conversations are being conducted with legal officials to compensate the disgruntled customers. Though fluctuation is a frequent scenario in the crypto market, concerns regarding customer data is also a relevant subject.
In July, the company was hacked via an employee computer and, “The attackers allegedly nabbed the names, email addresses, and mobile phone numbers (no passwords, apparently), of more than 31,800 customers.”
Other large cryptocurrency exchanges including, Kraken and Coinbase, have also faced similar issue recently after the hard fork cancellation.
Because price volatility gives investors an opportunity to win massive profits, and due to the unexpected server down across Bithumb network, lawsuit allegations against the exchange come at no surprise.
Bithumb concluded their statement with its concerns for the users who lost their funds and stated: “As soon as the compensation plan is confirmed, we will make a quick announcement.”
