OKX officially released the "Investigation and Explanation on the FLOKI Pledge Loan Mechanism Issues", the content is as follows:

Q1: Why is automatic currency swap triggered when the risk rate of pledged currency is safe? What are the specific rules for automatic currency swap?

OKX's current mortgage loan is a C2C market that matches depositors and borrowers. Based on the basic operating principle of 100% reserve, when the platform's loan amount/deposit amount reaches 100%, the platform's automatic currency exchange mechanism will be triggered. The triggering of the automatic currency exchange mechanism depends on the loan amount and deposit amount of all users on the platform, and has nothing to do with the pledge risk rate of a single user. When the automatic currency exchange is triggered, in order to reduce the risk of all platform borrowers as soon as possible, the users will be graded from large to small according to their loan amount. The group of users with the highest loan amount will be given priority to be automatically exchanged by the system;

Q2: Why doesn’t OKX stop borrowing new loans to keep levels normal?

When the amount of borrowed coins on the platform reaches the amount of coins on the platform, the platform will stop new borrowing. The reason for triggering the automatic currency swap this time is: due to Floki's on-chain activities, a large number of depositors redeemed their coins, the amount of user deposits decreased, and the amount of borrowed coins did not increase, thus triggering the automatic currency swap;

Q3: After reaching the automatic currency swap baseline, will users who may be triggered to automatically swap be notified in advance? Why didn’t I receive a timely notification this time?

After reaching the platform's automatic currency exchange baseline, the platform will send an email in advance to notify users who may be triggered to automatically exchange currency. Due to the problem of the email system, the warning email of a small number of users failed to reach in time. If you encounter the problem that the warning email did not reach in time, you can contact OKX customer service for feedback;

Q4: Will it be possible to optimize the product in the future to help users understand the stages of their automatic currency exchange debt liquidation?

In the future, OKX will further optimize the email and notification system to ensure that email warning notifications are sent in advance before the automatic currency swap is triggered. At the same time, the display of the mortgage loan page will be optimized to clearly inform users of the automatic currency swap liquidation tiers. #zachxbt