Delta Exchange Abruptly Tells Users to Exit Their Trades

Delta Exchange abruptly shut down options trading on Friday, citing future “maintenance” and telling users to close their open positions or risk getting locked in for an eight-hour period on Sunday.

The unannounced shutdown took place around 5 p.m. Eastern. Users were prevented from placing new orders for options on the platform, but could still close — or sell — their open positions at prices set by the exchange. An administrator in the company’s Telegram channel cited an eight-hour maintenance period set for Sunday, saying, “It’s a tech requirement and has to be followed.”

In an announcement also posted in Telegram, Delta said the maintenance would involve moving its Amazon cloud infrastructure “from Ireland to Tokyo.” In an error-filled message on Telegram, the Delta administrator added, “There is no shutdown of trading, only opening new positions for options with maturities after 18th are not allowed.”

The move came as traders broadly anticipated bitcoin’s price to crater below the $20,000 mark, setting off a wave of liquidations and potential trouble for cryptocurrency companies ranging from investment firms to exchanges and liquidity providers. It stood around $20,500 as of Friday evening after reaching a low of $20,111 earlier in the week.

Delta Exchange is particularly vulnerable to volatility in the market as the only centralized exchange to offer options trading on several smaller cryptocurrencies — including including Ripple (XRP), Solana (SOL), Avalanche (AVAX), and Chainlink (LINK). The coins are especially prone to rapid price fluctuations.

The Singapore-based exchange, headed by CEO Pankaj Balani, is not licensed to operate in the United States, and has been known to use less-than-scrupulous tactics to make up for potential losses on its riskier products. Those methods range from misreporting market prices through its user interface — which can result in traders losing as much as 99 percent of their money within seconds if they place a market order — to enabling wild swings in liquidity.

The company could stand to lose big on options trading if traders correctly predict a tumble in prices. Delta said Friday that it “strongly” advised users to close their open positions in light of its technical issues.

“Please note that maintenance is ~8 hours long,” Delta wrote in its announcement. “Given the unprecedented uncertainty and volatility in the market, we would strongly advise you to close your open positions and cancel open orders. Please be mindful that no orders (limit or stop) will get executed while the maintenance is going on.”

Friday’s closure of options trading added roughly 43 unannounced hours to the shutdown, which the company said would end at 8 a.m. Eastern on Sunday.

It’s the second time in a month that Delta has experienced a meltdown. It also closed for “unannounced maintenance” and shut down user withdrawals for several days in mid-May amid the market spiral prompted by the breakdown UST and LUNA.

Several crypto firms have run into trouble over the last several weeks. Babel Finance became the latest example on Friday with an announcement that it was “suspending” user withdrawals from the platform, after the Celsius Network made the same announcement about its own users on Sunday. And BlockFi, a competitor to Celsius, acknowledged on Thursday that it had liquidated Three Arrows Capital, a crypto investing firm, as part of an effort to reassure its own users that it had protected itself against impending calamity.