Paradex’s Bitcoin Perpetual Contracts Face Major Setback
The price of Bitcoin on the decentralized exchange Paradex unexpectedly dropped to $0 overnight due to issues related to database migration that impacted various aspects of the Paradex blockchain, along with its block explorers, bridges, and APIs, as mentioned by several users.
This situation was first noted on the Paradex Status Page around 12:36 a.m. ET on Monday, just as Bitcoin’s price took a nosedive, stirring up discussions on social media about a series of liquidations happening concurrently.
By about 2 a.m. ET, Paradex pinpointed the issue and started to address it, rolling back the state of the Paradex Chain, which is built on the Starknet layer. Starknet serves as an Ethereum layer 2 scaling network.
“We have identified the issue and plan to roll back the chain state to block 1604710,” read an update. “This is the pre-DB maintenance point and the last known good state. All accounts will be restored to their pre-DB maintenance state. We will provide more updates as we continue with the rollback.”
Soon after, Paradex canceled all outstanding orders and confirmed around 5 a.m. ET that all user funds remained secure as the recovery process was put into action.
“Recovery efforts are ongoing. We can confirm that all user funds are SAFU,” a message posted at 5:16 a.m. ET stated.
The customer liquidation total remains uncertain, but data from DeFiLlama indicates that the perpetuals protocol has about $641 million in open interest. Over the last 30 days, it has facilitated about $37 billion in financing.
According to a status page update, all Paradex services have since resumed normal operations.
Meanwhile, Bitcoin’s recent fluctuations followed a rocky trading period, with its price dropping from over $95,000 to $92,284 shortly after 7 p.m. on Sunday. This 2% decline has trimmed the weekly gain to just 1.4%, with Bitcoin recently trading at approximately $93,318.
These fluctuations have triggered an increase in liquidations, now surpassing $875 million within the past 24 hours, including about $234 million linked to Bitcoin, as per CoinGlass data.
