XBTU19 and ETHM19 Auto-Deleveraging Events 2 April 2019

On 2 April 2019 between 04:44:34 UTC and 05:22:08 UTC, less than 200 positions were auto-deleveraged due to the sharp price movements of the underlying mark price on XBTU19 and ETHM19.

At the time of these auto-deleveraging events, the Insurance Fund allocated to these contracts was minimal. The Insurance Fund is allocated individually to each contract according to how many liquidations contribute to that specific contract (System Gains and Losses). In the case of expired contracts, BitMEX has a process in place to roll over the Insurance Fund allocated to these contracts into the next front month contract. With the recent expiry on the 29th March 2019, this process failed and front month contracts did not receive their reallocation, and the funds remained unallocated. As a result, a handful of users were auto-deleveraged upon large liquidations within these affected contracts.

BitMEX receives auto-deleveraging reports and was made aware of the unusually high rate of auto-deleveraging events, at which point we investigated the matter. We identified the root cause, corrected the allocation and put further controls in place to ensure that reallocation failures are automatically flagged internally.

For users that were affected, BitMEX will be reaching out to you personally to explain the situation and document your compensation. We compensated users based on the maximum potential profit that they would have made over the timeframe of these auto-deleveraging events. We exited these users at the best price of each contract: longs at 5,079.5 on XBTU19 and shorts at 0.03103 on ETHM19. BitMEX did not profit from these auto-deleveraged positions.

We apologise for any inconvenience this caused. Should you have any questions, please contact customer support.