Paradex Resource $650,000 After Maintenance Failure Causes Involuntary Liquidations

Paradex announced a compensation plan to reimburse $650,000 to 200 users who were affected by a technical incident during platform maintenance. The episode, which occurred on January 19 during a 30-minute database maintenance window, resulted in unintended liquidations and significant losses for traders.

When a Maintenance Failure Triggers a Cascading Effect

During the scheduled update, an unexpected problem — specifically a race condition in critical data operations — caused information to be corrupted and incorrectly recorded in the cloud. This tainted data was subsequently published on Paradex Chain, directly affecting the platform’s metrics. The result was catastrophic for some traders: market funding rates were anomalously reset to zero, causing extreme fluctuations in profit and loss calculations. This cascade of errors automatically triggered liquidations across multiple markets, capturing positions that should have remained active.

Takeprofit and Stop-Loss Orders Protect Traders in This Critical Situation

Paradex responded quickly upon detecting the problem. The platform temporarily suspended user access, canceled all open orders except for takeprofit and stop-loss orders — essential protective measures that maintained the integrity of traders’ defensive strategies. This decision was crucial to prevent further damage during the critical period.

Full Restoration and User Compensation Plan

To resolve the situation, Paradex rolled back the blockchain state to a point prior to the start of the maintenance window, effectively undoing the problematic operations. The reimbursement of $650,000 to the 200 impacted users reflects the exchange’s commitment to protecting its users’ interests. This is not the first maintenance-related incident in the platform’s history — previously, Paradex had experienced temporary unavailability due to similar state restoration issues during database updates.