Caixin: Xingqiao Capital's London Gold Margin Call Incident Partially Funded with USDT, Retrieval Difficulty Increases

BlockBeats News, August 21st. According to Caixin, SBCFX experienced a London Gold trading abnormality and forced liquidation event. After the incident, the platform's Hong Kong office was found empty, and some investors are facing significant losses. Multiple investors revealed that their automatic trading of London Gold (XAUUSD) derivatives on the SBCFX platform encountered an extreme abnormality on the night of August 19th: the system generated a huge amount of automatic short positions within 1 to 3 seconds, followed by a rapid increase in the international gold price, leading to a collective liquidation of accounts. Some accounts were reduced to zero balance, and some even showed negative balances.

The so-called London Gold forced liquidation refers to a situation where the trading direction is opposite to the price movement, and due to leverage and other reasons, the losses are too great. The investors' available margin is exhausted, falling below the maintenance margin ratio, leading to a forced liquidation by the platform and a total loss of principal, posing a significant trading risk. Affected investors estimate that this incident involves approximately 2,000 to 3,000 people, including a large number of mainland Chinese investors. Currently, some investors have reported the incident to the Hong Kong police and requested the platform to return 70% of the principal in accordance with the "maximum loss of 30%" rule promised earlier. Some investors stated that SBCFX provided up to 500 times leverage, and some funds were deposited through USDT stablecoin, increasing the difficulty of fund traceability.

Public information shows that SBCFX's business scope covers foreign exchange, commodities, indices, cryptocurrencies, etc., and it claims to be a licensed and compliant international trading platform. (Caixin)