Georgia’s national currency currency is a medium of exchange that defines value. marked an erroneous price of GEL $290 instead of GEL $2.90. The exchange businesses that allow customers to trade cryptocurrencies for fiat money or other cryptocurrencies. is now seeking to recover the funds.
- Georgians were able to sell cryptocurrencies for 100 times their value on Coinbase.
- The exchange rate of the Georgian lari was much higher than in the rest of the market.
- Coinbase is looking to recover funds and local banks are blocking users.
A group of users of the cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. exchange Coinbase is an American company that operates a cryptocurrency exchange platform. in Georgia benefited from a platform error that allowed them to collect far more money than they were entitled to.
Users took advantage of a decimal error in the European country’s national currency exchange rate to charge 100 times the expected market an area or arena, online or offline, in which commercial dealings are conducted. rate, allowing them to rake in millions of dollars in profits. The news outlet Blockworks reported first.
According to reports, Georgia’s national currency, the Georgian lari (GEL), marked a price of GEL $290 instead of GEL $2.90 on the platform Coinbase for a short a trading technique in which a trader borrows an asset in order to sell it, with the expectation that the price will continue to decline. In the event that the price does decline, the short seller will then buy the asset at this lower price in order to return it to the lender of the asset, making the difference in profit. period of time on August 31. The incident meant that accounts using the Georgian lari as a reference rate rose a hundredfold in value.
Simply put, a transaction valued at 100 Lari could be executed for 10,000 Lari. Approximately 900 traders took advantage of the inflated exchange rate to sell cryptocurrencies for much higher figures than usual.
Users took advantage of the opportunity to exchange their cryptocurrencies and withdraw them at fiat fiat currency is “legal tender” backed by a central government, such as the Federal Reserve, and with its own banking system, such as fractional reserve banking. It can take the form of physical cash, or it can be represented electronically, such as with bank credit. to their bank accounts. Some also resorted to arbitrage arbitrage is the practice of quickly buying and selling the same asset in different markets to take advantage of price differences between the markets. between exchanges to transfer cryptocurrencies purchased from other platforms and sell them with the exceptional gain in Coinbase according to the report.
A spokesman for Coinbase explained to Blockworks yThe Block a file containing information on transactions completed during a given time period. Blocks are the constituent parts of a blockchain.that the decimal error was due to a problem with a third-party provider and that it had fixed the bug immediately upon detection. The incident lasted for about 7 hours and 0.001% of the total users of Coinbase managed to exploit the flaw, he said.
Banks block accounts to users of Coinbase
The exchange did not disclose the losses, although the spokesman described it as “a small non-material amount” . Coinbase said he is now working to get the money back. “ Upon detection, we fixed the problem and are taking steps to recover the improperly withdrawn funds. “.
Since then, users have been reporting blockages on their bank accounts and credit cards. According to reports, several customers of the platform a place to buy, sell and store cryptocurrency have experienced blockages of their bank accounts. since the incident, even those who did not exploit the flaw. Some reported receiving a notice from their financial institutions informing them that their bank accounts and debit cards had been compromised. Visa associated had been frozen.
Georgian traders have been reporting on the blockade by the banks through groups on Telegram y Facebook . According toThe BlockThe majority indicate that the two main banks in the country, Bank of Georgia y TBC Bank are the ones who have frozen accounts and imposed card blocks.
“ Hello, we have flagged your Coinbase transactions as suspicious and are blocking all your accounts and cards. Please note that Coinbase may request the recovery of the funds “says the message from one of the banks that was received by an affected customer and which was quoted by Blockworks .
The move could be a response to the efforts of Coinbase to recover the misplaced funds, although a source close refers to the closing price; similar to the same term used in stock trading. to the matter told Blockworks that the banks were not acting under the direction of the exchange.
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Article by Hannah Estefania Perez / DiarioBitcoin
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