Bitcoin briefly traded at $0 on the Paradex platform in the early hours of Monday local time, after a technical issue during scheduled maintenance caused mass liquidations on the decentralized perpetual futures crypto exchange. This then forced the platform’s engineering team to announce a rarely used chain rollback to undo the damage.
The incident occurred shortly after Paradex performed database maintenance at approximately 5:30 AM Hungarian time. After starting the update, dealers will start working on it immediately reported that several legacy markets, including bitcoin, ethereum and solana, saw prices drop to zero.
Screenshots and videos shared on social media showed the platform being flooded with liquidation warnings almost simultaneously. This indicates that the exchange’s pricing mechanism or oracle flow failed during the update.
According to the time-stamped warnings, the most intense activity occurred around 6:02 a.m. on January 19, 2026.
Reversing the Paradex chain after mass liquidations
In bitcoin futures contracts, many long positions were liquidated at zero, while some short positions were closed at the normal market price of almost $92,600. This indicates that the problem disproportionately affected one side of the order book.
The sudden revaluation of the exchange rate automatically forced the closing of leveraged positions to avoid negative balances, amplifying the damage within seconds.
About three hours after the event, Paradex CTO Clement Ho addressed users via Telegram. He confirmed that the team has identified the issue and is restoring the chain status to block 1,604,710 with a timestamp of 04:27:54 UTC.
Ho noted that this block represented the last known correct condition before maintenance began. Paradex later reiterated this message on its website, stating that repairs were underway and that users’ balances were safe.
In this context, a rollback means that the state of the blockchain and its related system returns to the state it was before the erroneous transactions, essentially canceling all transactions, deposits, and liquidations that occurred after that freeze. While incorrectly liquidated positions are restored, this rollback also means that any profits made after the rollback point are also erased.
Such rollback-type measures are usually used as a last resort in decentralized systems, as they undermine the principle of immutability that blockchains aim to maintain.
It is one of the largest futures trading platforms
Paradex operates as a decentralized perpetual futures exchange on Starknet and has now emerged as one of the dominant platforms for on-chain derivatives trading.
To DefiLlama facts According to the platform, the day before the incident, the platform processed nearly $1.6 billion in trading volume and managed approximately $225 million in user deposits.
According to CoinGecko, Paradex is among the top ten decentralized perps exchanges over a 30-day period with a reported trading volume of over $37 billion.
Following the liquidations, Paradex reported a platform-wide service outage affecting the trading interface, APIs, blockchain components, bridge and block explorer.
As part of the recovery process, the exchange has announced that it will cancel all outstanding orders except take-profit and stop-loss orders. The later published updates confirmed that platform and vault withdrawals have been re-enabled, but Gigavault deposits and withdrawals have been suspended for up to 24 hours.
The team also warned about fake accounts communicating on behalf of Paradex’s technical team during the outage. It asked users to rely only on official channels.
This incident has once again focused attention on the technical risks of on-chain derivatives markets, which have suffered a number of disruptions in recent months. A similar incident occurred last September when Aster, the largest perpetrator exchange by revenue, suffered heavy losses after being targeted by advanced trading strategies. One of those high-profile incidents was the extraordinary price increase of XPL’s perpetual contract.
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