What to Know
- Bitcoin briefly showed as $0 on Paradex due to a database update error, triggering over $128M in forced liquidations.
- Paradex halted trading, rolled back the chain to a pre-error block, cancelled open orders, and resumed after eight hours.
- The glitch added pressure to Bitcoin’s short-term price drop amid broader market weakness.
Bitcoin traders were left shocked today after the price of Bitcoin briefly showed as $0 on Paradex, a DEX on Starknet. The sudden drop was not caused by the market itself, but by a technical error during a database update. Still, the impact was real and painful for many traders.
What exactly Happened?
Paradex was carrying out routine maintenance that included a database migration. During this process, faulty data entered the system. As a result, Bitcoin’s price briefly appeared as $0.00 on the platform. This wrong price triggered automatic actions on the exchange. Many traders who had open positions were forcefully closed out within minutes. Reports estimate that more than $128 million worth of positions were wiped out because of this error.
To contain the damage, Paradex halted trading and took the unusual step of rolling back the chain to a block before the error happened. Most open orders were cancelled, except for take-profit and stop-loss orders. Trading resumed after roughly eight hours of downtime. Paradex later said that all user funds were safe and that the rollback was needed to restore the system to a stable state. In an update on its status page, Paradex wrote that: “We can confirm that all user funds are SAFU. Due to the complexity of the recovery process, we do not have a confirmed ETA at this time.”
Why did Liquidations happen so Fast?
On trading platforms, prices are used to decide when a position should be closed automatically to prevent further losses. When Bitcoin suddenly showed as $0, the system treated it as a total price collapse.
Because of this, many long positions were instantly closed, even though Bitcoin’s real market price had not crashed anywhere close to zero. This created a wave of forced selling that added to panic across the platform. Even though the issue was technical, the emotional reaction from traders was very real.
Bitcoin Price Action
Outside of Paradex, Bitcoin saw a short-term dip. Over the last 24 hours, Bitcoin fell 2.01%. This move stood in contrast to its gains of 1.36% over the past week and 5.89% over the past month. Bitcoin was already facing resistance near the $97,000 level before the Paradex incident. It failed to break above this price, which encouraged some traders to sell. At the time of writing, BTC is trading at around $93,255.
At the same time, global uncertainty added to the cautious mood. Tensions related to trade policies between the U.S. and Europe, along with uncertainty around future interest rate decisions, pushed investors toward safer assets. Large holders were also seen moving Bitcoin to exchanges. This behavior usually signals selling rather than buying, which can increase downward pressure.
Impact on Paradex and Starknet
Paradex said it has rolled back to block 1,604,710 and restored trading as of 12:10 UTC. Despite this, trust may take time to rebuild. Rollbacks are controversial in crypto because they go against the idea of an unchangeable record. Following the incident, Starknet’s native token STRK fell about 3.6%, showing that the effects spread beyond just one exchange. At the time of writing STRK is trading at around $0.0826.
This is not the first challenge for Paradex. The platform has faced technical issues before, including disruptions caused by heavy system load in past months.
What’s Next?
For Bitcoin, traders are watching the $92,000 level closely. Holding above this price could prevent further forced selling. Falling below it may lead to more pressure.
For Paradex, the key question is trust. While funds were reported safe, users will be looking for stronger safeguards to prevent similar errors in the future. The incident is a reminder that even in decentralized systems, technical mistakes can have serious real-world consequences sometimes in just a few minutes.
Also Read: Cardano vs Solana: Which Blockchain Is Better for Long-Term Growth?
