[Analysis] The $14 million CLAM flash crash - Amy Castor

On May 26th, Circle's Poloniex exchange experienced a flash crash of token Caritas Libertas Aequitas Monetas ($CLAM) to the tune of 1,800 Bitcoin ($BTC) or $14 million. With nothing to repay loans, the exchange decided to socialize losses to all loaners at 16.202% of the principal. In the aftershock, users are wondering not only why such an illiquid coin was trading, but why Poloniex failed to have a stop check in a place like an insurance fund. The coin had even been de-listed before in Nov. 2017. In Amy Castor's view, the CLAM fiasco in context of Poloniex's greater history only adds to a story of buyer beware for the exchange's users.