Former Alameda employee: The instantaneous 87% plunge of BTC on Binance.US in 2021 was caused by Alameda traders’ operational errors

Odaily Planet Daily News Baradwaj, a former employee of Alameda Research, revealed that the company was the "behind the scenes" that caused the price of Bitcoin to drop by more than 87% in a short period of time in 2021. The former employee has begun to reveal the inner workings of the company. It is understood that on October 21, 2021, when other markets were operating normally, BTC on Binance.US plummeted within a few minutes, falling from around US$65,760 to a low of US$8,200 at 11:34 that day, and then quickly bounced back to previous levels. A Binance.US spokesperson said at the time that the plunge was due to a vulnerability in the trading system of one of their “institutional traders.” The true identity of the investor remains a mystery, but Baradwaj disclosed in a post on the X platform that Alameda may be the cause of the chaos. Baradwaj claims that while most Alameda trades are executed using algorithms, sometimes traders can manually send orders or take advantage of profit opportunities during market volatility, which is why the apparent blunder occurred. Baradwaj wrote: “This trader attempted to sell a batch of BTC based on some news and placed the order through our manual trading system. However, they ignored a few spaces after the decimal point and did not sell the Bitcoin at the then market price. , but sold it at a very low price." Arbitrage traders quickly took advantage of the mispricing, and Alameda lost millions of dollars. (CoinDesk)