On March 12, a cryptocurrency trader appears to have made a disastrous swap on Ethereum (ETH) that resulted in a 99.93% loss in about a minute.
Specifically, an X post made by Stani Kulechov, the Founder and CEO of Aave (AAVE), revealed that one investor initiated a trade on Thursday in which they attempted to swap approximately $50.4 million worth of the stablecoin USDT for AAVE.
Considering that the cryptocurrency was, on March 12, trading close to $110, the trade should have resulted in the acquisition of about 458,479 AAVE.
AAVE price one-week chart. Source: FinboldInstead, an issue arose due to the scale of the swap and led to the digital assets trader getting only about 327 – worth $36,297 – for a total loss of about 99.93% within as much time as it took to approve and execute the trade.
How this crypto trader suffered a 99% loss in seconds
Elsewhere, Stani Kulechov initially explained the disastrous trade as resulting from the investor accepting the trade even after getting a pop-up that the size of the swap would make the end result unfavorable.
Specifically, the Founder and CEO emphasized that nothing went wrong with Aave systems and that the mechanics worked as intended, with the issue arising from a possibly absent minted approval on the user’s phone.
Despite this, Kulechov also revealed his company would refund the $600,000 in fees collected from the transaction.
Additionally, Martin Grabina, an Aave engineer, clarified that the 99.93% loss occurred due to the price impact arising from the scale of the USDT to AAVE swap rather than from slippage.
He did, however, confirm that the systems worked as intended and that the user saw the warning pop-up and confirmed the trade in spite of the warning about the staggering loss.
Featured image via Shutterstock
Source: https://finbold.com/crypto-trader-accidentally-swaps-50-million-for-36000-aave-in-a-minute/
