Who Turned Out The Lights?

By: Mark Hope, Chief Compliance Officer, FINXFLO

It is often the case that in times of crisis, those who lack conviction can become exposed. Recent volatility in the crypto market has served to highlight this, with many exchanges pulling pricing at the worst possible time, leaving their customers unable to get out of positions. When this happens, and it almost always happens, traders are left with little option but to sit back and watch as the market goes into a feeding frenzy taking bites out of their personal wealth.

Back in 2015, when the Swiss National Bank (SNB) scrapped its 3-year peg of CHF 1.20 to the Euro, the franc broke past parity to trade at 0.805 before levelling out at 1.04. To the contemporary reader, a 30% swing in something like BTC could be seen as relatively normal, even expected, but in a benign market like EURCHF, this was an absolute catastrophe. Imagine USDT taking a 30% nosedive and you can start to get an idea of just how catastrophic this was.

Once the dust had settled from the de-peg and the bean-counters had done what they do best, it became clear that many traders had been unable to get out of their positions in time because the banks had effectively stopped pricing. Unfortunately, it seems like their customers were the last to find out about it. Some of the Banks’ customers went under completely, the lucky ones were forced to sit back and watch…

If you’re thinking that this all sounds very familiar, you’d be right, but there is one key difference: outrage.

Both customers and regulators alike professed outrage that the banks had discontinued pricing without warning the market, choosing to protect their own interests and pocket some very handsome profits, literally at the expense of, and to the detriment of, their customers.

But, I hear you ask, this is crypto, and in crypto there is no outrage, there are no regulators holding exchanges to account for the discontinuation of pricing, and there is nothing we can do about it.

Well, that’s not entirely true. During the market turmoil yesterday, and back in May, FINXFLO was able to keep the doors open and the lights very much on. Our unrivalled access to aggregated liquidity meant that despite the market doing the best it could to shut everyone down, we were still there, standing amongst the rubble, offering fair and executable pricing to our customers, enabling them to exit the market and save themselves the anguish of just sitting back and watching.

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