Poloniex has finally delisted CLAM from its exchange. The obscure altcoin was responsible for a flash crash in May which allowed for 1,800 BTC ($20M) to be wiped from the entire margin trading lending pool.
The embarrassing saga surrounding Clams (CLAM) and the cryptocurrency exchange Poloniex finally comes to an end. Poloniex has officially announced that it is delisting CLAM entirely. On Oct 15, trading for CLAM will be closed and withdrawals will be permanently disabled on Nov 15.
The story started in May when a flash crash on the CLAM/BTC margin trading pair crashed some 80% in just 45 minutes. The end result was that lenders were forced to collectively pay 18000 BTC at the time, incurring losses which caused considerable anger. After all, why was CLAM even allowed to be traded on margin? That was the question everyone was asking, and suddenly everyone was wondering what this obscure altcoin even was.
Poloniex tried its best to resolve the situation by promising to reimburse all the victims of the flash crash. Some $18M is what the exchange promised, but it’s currently unclear whether all of it was distributed yet. When BeInCrypto last reported on the story two months ago, the exchange had paid back 180BTC (around $2M) to those affected.
Now that CLAM is getting delisted, its price has plummeted around 48% at the time of writing.
Poloniex’s Reputation Still Remains Uncertain
Poloniex said that it was “dedicated to earning back user’s trust” in its official blog post. However, one can’t help but laugh at the fact that a ridiculous altcoin like Clams (CLAM) was able to effectively incur losses of $20M for an exchange like Poloniex. Still, it’s hard to think of Poloniex today without Clams coming to mind and the entire embarrassing fiasco.
The lesson for all exchanges from this saga should be, simply: don’t offer cryptocurrencies with low liquidity for margin trading. It’s a disaster waiting to happen, as Poloniex has clearly demonstrated.
Do you think that Poloniex can recover its reputation? Let us know your thoughts below in the comments.