Bitcoin "0 USD" triggers liquidation wave! Paradex pricing anomaly causes disaster, emergency "rollback" sparks controversy

Paradex, a perpetual contract exchange based on Starknet, experienced a technical failure on Monday, during which Bitcoin temporarily displayed an “$0” extreme quote on the platform, immediately triggering a wave of automatic liquidations. This rare event prompted the official to announce a “rollback” of the blockchain, sparking heated discussions in the crypto community. Users on social media reported that at the moment of the incident, the Paradex interface showed Bitcoin’s price instantly dropping to zero, then quickly returning to normal. However, before the price rebounded, thousands of positions had already been liquidated and forcibly closed by the system. One user posted: “At first, I thought it was just a UI bug, until I saw on my computer that Bitcoin dropped to $0 and then immediately came back. That’s when I realized something was wrong. Thousands of liquidations have already occurred. This is definitely not good news for Paradex.”

🩸🚨Okay, when I posted the screenshot, I thought it was a UI bug.

Then I saw on the computer that the price came back after going to $0.

Now there are thousands of liquidations.

This doesn’t look good for @paradex ☠️ https://t.co/m4YbnfHkgN pic.twitter.com/QbKd3U432s

— Sniper ₿ (@sniiperrB) January 19, 2026

In response to the catastrophic failure, Paradex officials later announced on Discord that the issue stemmed from an error during the database migration. To fix the problem, the team decided to take an extremely rare and controversial measure — a “rollback.” Clement Ho, Paradex’s Chief Engineer, stated that the system would revert to the last correct block before the maintenance began (block height 1604710). This means that all transactions, liquidations, and deposits/withdrawals during the failure period will be “reversed,” attempting to restore the exchange to its pre-failure state. While this action can save users from unjustified liquidations, it also erases legitimate profitable trades made during that period, leading to polarized opinions. In the blockchain world, “rewriting history” has always been considered an extreme and unavoidable measure, as it contradicts the core principle of decentralization — once a transaction is completed and confirmed, it should have finality and cannot be arbitrarily overturned. For this reason, when most public chains or protocols encounter major failures, the usual approach is not to rollback completed transactions but to pause operations or apply targeted patches to contain risks, minimizing damage. Compared to that, employing a “rollback” mechanism is equivalent to admitting that existing protective measures have completely failed.