Author: momo, ChainCatcher
Original Title: LA Contract "Price Spike" Controversy: Gate.io Data Source Anomaly, Liquidated Users Left to Bear Losses?
Recently, Gate.io has been embroiled in a controversy over the $LA/USDT contract abnormal "price spike". Multiple users have accused Gate.io of potential market manipulation during extreme price fluctuations, resulting in numerous users experiencing abnormal liquidations and even over-liquidations, causing substantial losses.
Although Gate.io has responded to the incident's cause and compensation plan, community users seem unconvinced. ChainCatcher sought further response from Gate.io regarding user doubts, but the platform's reply remained largely consistent with the initial announcement, with no new detailed explanations.
[Image]
Why Are Users Unsatisfied with Gate.io's Response?
On June 4th at 8 PM (UTC+8), Gate.io launched the $LA/USDT perpetual contract. Approximately 4 minutes after opening, $LA's price surged from around 0.36 USDT to 27 USDT within seconds, then quickly dropped to around 0.2 USDT. During this period, LA's spot prices on other exchanges and on-chain prices were mostly around 1 USDT.
This abnormal "price spike" led to massive user liquidations, with some accounts experiencing over-liquidations. Crypto KOL @Elizabethofyou reported losses of 20,000 USDT, while @BTC_Alert_ claimed losses of 100,000 USDT and an additional 120,000 USDT owed to the platform, with inability to add or close positions during the event.
[Image]
Gate.io subsequently delisted the contract and announced around 9:28 PM that they would compensate for over-liquidation portions.
Multiple users, including @BTC_Alert_ and @Elizabethofyou, reported that transaction records appeared to have been altered after the over-liquidation compensation announcement. @Elizabethofyou claimed that three trading orders with total amounts of 4994 USDT, 7999 USDT, and 13990 USDT were changed to 49.94 USDT, 79.99 USDT, and 139.34 USDT respectively.
Some affected users consequently suspected Gate.io of "malicious market manipulation" or platform risk control issues.
On June 5th, Gate.io CBO Kevin Lee further responded to the contract trading anomaly, stating that the event was caused by an index source data anomaly and the compounded effect of automatic risk control mechanisms. He denied any internal operational behavior or intentional user liquidation.
Regarding compensation, Gate.io will only reimburse over-liquidation portions. The total compensation, including allowing all users to retain their profits, is approximately 30 million USD.
However, many users remain unsatisfied. Firstly, they believe the compensation plan is unreasonable, questioning why only over-liquidation is compensated while liquidation losses are not addressed.
Secondly, they find the explanation of data source anomalies unconvincing, suggesting the platform should disclose index source composition and anomaly logs to prove no internal manipulation.
Additionally, affected users expressed dissatisfaction with the platform's feedback speed and attitude, such as rejecting user mic requests and only hosting an English AMA.
[Rest of the article continues in the same translation style]
