Exchanges Round-Up: Chinese Court Backs Coinnice Repatriation, CZ Demos Binance DEX
In recent news pertaining to cryptocurrencies, a Chinese court has rejected an appeal from a trader disputing a previous decision that mandated he repay the value of 5 BTC accidentally credited to his Coinnice account, the CEO of Binance has demonstrated the company’s upcoming decentralized exchange (DEX), and Okex’s head of operations has discussed the company’s recent “socialized clawback”.
Also Read: Stablecoins Gaining Popularity in India to Minimize Central Bank’s Impact
Chinese Court Backs Exchange in Dispute Over 5 BTC Accidentally Credited to Trader
A Chinese court has rejected an appeal made by a bitcoin trader who was recently mandated to repay the fiat value of 5 BTC accidentally credited to him by an exchange operated by Beijing Grape Technology Co. The 5 BTC had been credited to Li Jianfeng’s account as the result of a system bug on the then-operating Coinnice exchange on the 10th of March 2017.
The court had previously ruled that Mr. Jianfeng had no legal claim to the 5 BTC, and mandated that he return the fiat value corresponding to the BTC at the time of their liquidation. Mr. Jianfeng appealed on the basis of the exchange’s operations being illegal according to China’s “Notice of the People’s Bank of China and other departments on preventing the risk of bitcoin,” however, the court rejected the case due to said notice not being in effect at the time of the incidents in question.
Ultimately, the court ruled that Mr. Jianfeng must adhere to the contractual policies enforced by the platform, determining: “In this case, whether or not Coinnice’s establishment as a bitcoin trading platform has violated relevant rules, does not have any impact on Li’s liability to return the profits he received with no legal basis….As such, the court denies his appeal and the decision is final.”
CZ Demos Upcoming Binance DEX
The chief executive officer of Binance, CZ, recently uploaded a video to Youtube providing the first demonstration of the company’s upcoming decentralized exchange, Binance Chain. The CEO indicated the company’s plans for the DEX are moving significantly ahead of schedule and that the demo had taken place “one to two months later” than anticipated.
The preview demonstrated the “issuing or creating of a token,” the “listing of the token on the decentralized exchange,” and “trading of the token against another token on the decentralized exchange.”
Despite the demo, CZ stressed that the platform is “very much still in early-stage development,” adding that “there is still a ton of work to be done” before the finalization of the platform.
Okex Head of Operations Discusses Recent “Socialized Clawback”
The Okex head of operations, Andy Cheung, has discussed the exchange’s recent “socialized clawback” that followed a $416 million liquidation that recently took place on the exchange’s futures markets.
Mr. Cheung stated that the liquidation and clawback were resultant from “merely a bad decision of a trader,” asserting that the exchange contacted the trader multiple times requesting that he “partially close the positions to reduce the overall market risks.” Despite such, Mr. Cheung stated that “the client refused to cooperate, which [led] to our decision of freezing the client’s account to prevent further positions [from] increasing. Shortly after this preemptive action, unfortunately, the BTC price tumbled, causing the liquidation of the account.”
Mr. Cheung described the incident as comprising a “valuable lesson” for Okex, asserting that despite the resulting socialized clawback, “From our data, we do not see any signs of the market sentiment being affected by this incident. We also do not see any signs of our customers’ sentiment being greatly affected. We would say this is a valuable lesson for us in improving our trading experience. We always encourage our customers to study the mechanism behind futures trading before joining the game to avoid unexpected losses.”
Although Mr. Cheung defended the company’s policies regarding socialized clawback, describing such as “balanc[ing] the interests between all parties involved” though stabiliz[ing] our platform’s operations” and “ensuring traders’ assets on our platform,” Mr. Cheung stated that Okex is “making efforts to eliminate the risk of large-scale clawback in the future.”
Are you surprised by the Chinese court’s decision to reject Li Jianfeng’s appeal? Share your thoughts in the comments section below!
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