PDAX Debacle: Modulus CEO Says Crypto Exchange Collapse is Just the Beginning

PDAX, a licensed crypto exchange operating in the Philippines, suffered an outage earlier this month. There have been multiple reports that traders were able to purchase Bitcoin at a steep discount during a time when BTC was trading at new all-time highs.

A statement from PDAX was shared in the Manila Bulletin:

“On February 16, 2021, our system was hit by an unprecedented surge in transactions, which caused it to experience significant maintenance issues. PDAX transactions grew to 70x over the past months, and we note that at this pace, other exchanges such as Coinbase and Kraken have also experienced recent outages. The pandemic has led to massive shifts in online financial behavior; beyond what our growth models predicted. “

A later report by the Manila Bulletin published today (February 26) claims that several hundred accounts remain locked out from accessing the crypto exchange. While many accounts have been restored and PDAX claims that “funds and assets are safe” the crisis will not instill much confidence in the operation.

The report adds that PDAX is citing “extensive reconciliation” and “complicated transactions” as to why users are still boxed out from the platform.

Today, the Modulus CEO is throwing some salt on the wound calling the collapse of PDAX as “just the beginning.”

Richard Gardner says there is talk that the exchange is demanding the return of purchased Bitcoin angering traders:

“There’s even more outrage that customers have been locked out of accounts and threatened with legal action, but, in truth, that’s only a symptom of the real problem. The truth is that this is just the beginning. Most exchange operators lack the skillset to build out their own technology stacks. So, they use white-label technology to get to market faster. The problem is that most exchange technology providers are brand new to the exchange space and have rushed their products to market. They don’t understand the true pressures exchanges face during trading surges.”

According to  a statement on Twitter, PDAX says a surge in trading caused “significant maintenance issues.”

PDAX also states they are working with Bangko Sentral ng Pilipinas, the central bank of the Philippines, in regard to compliance with all policies.

 

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