Margex Exchange Allegedly Rugpulled, Leaving Users with Massive Losses
One user publicly claimed a loss of $280,000, alleging that Margex nullified all XRP trades, clawed back previous gains, and locked their account, leaving them with a zero balance.
The cryptocurrency exchange Margex, known for its unique feature allowing users to leverage trades using any asset as collateral, has recently allegedly rugpulled leaving users to suffer massive losses.
The issue centers around the platform’s handling of XRP, a prominent cryptocurrency, leading to widespread user complaints, accusations of theft, and ultimately, a suspension of withdrawals.
The controversy began with numerous reports from users detailing substantial losses and the inability to access their funds. One user publicly claimed a loss of $280,000, alleging that Margex nullified all XRP trades, clawed back previous gains, and locked their account, leaving them with a zero balance.
The user’s account highlights a pattern of alleged actions by Margex: nullification of profitable XRP trades, retroactive seizure of prior profits, and complete account freezing, preventing the withdrawal of assets not even involved in the affected trades. The narrative, amplified through social media, paints a picture of systemic issues rather than isolated incidents.
Margex Announced Delisting of XRP Amidst Users’ Usage as Collateral
These reports are not isolated. Numerous users have voiced similar concerns, describing losses ranging from significant to substantial. Additionally, adding fuel to users’ concerns, the announcement to delist XRP, which many used as collateral, further ignited anxieties.
The unified experience of affected users a combination of trade nullification, profit clawbacks, and account freezes strongly indicates a coordinated action by the exchange, rather than a series of independent technical malfunctions.
The subsequent announcement by Margex suspending withdrawals and imposing additional withdrawal fees serves to exacerbate the concerns. The exchange plays its withdrawal suspension on reports of mass liquidations during a recent market downturn, strongly suggesting a liquidity crisis at the exchange.
Nonetheless, this scenario mirrors the collapse of other prominent cryptocurrency exchanges, drawing parallels with the well-known FTX debacle, albeit on a smaller scale. The underlying cause of Margex’s financial difficulties remains unclear, but the confluence of events strongly indicates an identical rugpulling system.
