Key Takeaways
- The exchange had issued eight legal letters targeting accounts that allegedly gained over $20 million during the episode.
- Bitget attributed the instability to a suspected bug in its market-making bot, which it said allowed rapid price swings and instant order fills
Leading crypto exchange Bitget has begun legal proceedings against eight individuals it accuses of manipulating the market for the VOXEL token, which triggered massive price fluctuations.
The Seychelles-based exchange said Saturday it would distribute any recovered funds to users via an airdrop. Bitget flagged “abnormal activity” in VOXEL/USDT perpetual futures on April 20, noting unusual trading volumes and sharp price swings. During a 30-minute window that day, the price of VOXEL surged by over 200%, briefly overtaking Bitcoin as the platform’s most traded asset.
Bitget’s head of Asia, Jiayin Xie, said the exchange had issued eight legal letters targeting accounts that allegedly gained more than $20 million during the episode. “We will release a complete report on the VOXEL incident as soon as possible,” Xie said in a statement on X (formerly Twitter).
Trading activity during the spike suggested that orders were executed without following standard order book procedures. Bitget attributed the instability to a suspected bug in its market-making bot, which it said allowed rapid price swings and instant order fills, enabling certain traders to make large profits.
Following the incident, Bitget temporarily suspended the accounts involved and paused trading on the VOXEL/USDT contract. The platform has pledged to compensate users who suffered losses and has already rolled back irregular trades. Xie assured users who traded VOXEL between 16:00 and 16:30 UTC on April 20 and subsequently withdrew funds that their accounts have been restored without further penalties.
Despite the severity of the incident, Bitget insisted there was no evidence of an internal breach or exploit. The exchange has not disclosed the identities of the individuals under investigation.
The VOXEL disruption coincided with a separate market event involving Bitget’s BGB token. On Sunday night, BGB plunged by around 52%, falling from $1.14 to $0.54 in less than an hour, before recovering most of its losses. Bitget attributed the BGB flash crash to “unexpected volatility” across the broader crypto market.
The VOXEL token, the native asset for Polygon-based game Voxie Tactics, had spiked by more than 560% compared to 48 hours earlier before falling back. It was trading at approximately $0.074 at the latest reading, according to CoinGecko, down around 47% from its peak during the incident.
Bitget said it is committed to enhancing trading safeguards and promised a full incident report to provide greater transparency around the VOXEL manipulation case and steps to prevent future occurrences.
