Kris Marszalek, the CEO of Crypto.com, thinks that regulators should look into crypto exchanges that contributed the most to the massive $20 billion liquidations.
Marszalek has taken to X and voiced his opinion about the widespread liquidations, which surpassed previous market crashes, including the one caused by FTX.
Regulators should probe crypto exchanges
He wrote, “Regulators should look into the exchanges that had most liquidations in the last 24h and conduct a thorough review of fairness of practices.” Marszalek is concerned that some exchanges failed to treat traders fairly, mispriced assets, or prevented withdrawal requests.
Cryptopolitan reported that some centralized exchanges faced major congestion during market liquidation. That led to widespread technical issues resulting in frozen apps and stuck order books. Some people were even locked out of their accounts during market turbulence, causing huge losses.
Moreover, Marszalek questioned whether exchanges have a robust setup to monitor trades and if there are any anti-money laundering (AML) programmes in place. He voiced his concerns and said, “$20B in liquidations, a lot of users got hurt. The job of regulatory bodies is to protect the consumers and assure market integrity.
Hyperliquid faced the biggest liquidations of $10.31 billion. ByBit and Binance ranked second and third with $4.65 billion and $2.41 billion being wiped out, respectively. OKX saw liquidations of $1.21 billion, while HTX and Gate traders lost $362.5 million and $264.5 million, respectively, based on aggregated data from CoinGlass.
On the other hand, DeFi platforms passed the stress test with flying colors. Decentralized exchanges (DEXs) such as Uniswap and Aave handled the market turbulence with zero technical issues and no interruptions. Aave handled $180 million in liquidations flawlessly and without any human intervention, while Uniswap processed close to $9 billion in trades as reported by Cryptopolitan.
The crypto market sentiment is labeled “Fear” as of October 11. Bitcoin is trading at $110,988 while Ethereum is hovering around $3,733.05 based on CoinGecko data. Despite the major liquidation, privacy coins are still trending up by 2.4% with Zcash trading at $287.50 while Monero is about to reach $300.
The biggest single-day market crash in crypto markets’ history proved that decentralized protocols with strong fundamentals are far more robust compared to centralized exchanges.
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