Poloneix Crash Cost Lenders $13.5 Million

Poloneix Crash Cost Lenders $13.5 Million

It has been revealed by exchange platform, Poloneix that last month’s crash on their service cost lenders $13.5 million.

The severe crash on their Clams (CLAM) market happened on the 26th May 201. Poloneix uses a peer-to-peer system for lenders and borrowers and when the crash happened, the CLAM market dropped 77% in less in one hour. In a panic, many lenders began liquidating assets in order to make up the borrowed cash.

However, due to the speed and size of the crash, Poloneix’s automatic liquidation system failed. In addition to this, “a significant amount of the total loan value was collateralized in CLAM, so both the borrowers’ positions and their collateral lost most of their value simultaneously”, according to a spokesperson for Poloneix. As a result, around 1,800 bitcoin were lost, which were valued at the time to be around the value of $13.5 million, hence where this figure has come from.

Poloneix has stated that those affected should not worry, as the lost funds will be refunded as soon as it recovers the lost money. In the meantime, all borrowers accounts are frozen until they are able to repay the loans.

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