Some popular crypto exchanges like FTX, OKX, and Bitfinex were knocked out by a Cloudflare outage. Cloudflare is a major content delivery network (CDN), It experienced issues with its services and network which resulted in widespread problems for numerous other portals, including crypto exchanges, and services like Zerodha, Discord, and Canva.
FTX tweeted that its platform and other sites will be difficult to access. As such, the exchange is now in a “post-only” mode. Other crypto exchanges like OKEx and Bitfinex confirmed that they are experiencing the same issue. This got OKEx asking if there is a Web3 alternative in the future. But many services were back up and running within two hours of the Cloudflare incident.
The losses caused by the outage are unclear at this stage. Advocates of decentralization have been warning of the risk of keeping one’s funds on centralized crypto exchanges for some time now.
They say it acts as escrows for customers and highlights their more user-friendly features. It’s akin to traditional banks or asset exchanges which are overseen by regulators. But some critics argue that centralized exchanges are more susceptible to hacks as they are responsible for large volumes of trades. Moreover, they store most of the trades on their own servers.
Users who conduct peer-to-peer transactions, automated by smart contracts, are believed to be at reduced security risks. This is because the funds are in users’ self-custodian wallets even when the decentralized exchange is hacked.
Besides creating hindrance to companies and services, the Cloudflare outage became the butt of jokes as it prompted Twitteratis to go on a meme-a-thon. Some users shared tweets with memes of Ashneer Grover and scenes from Mirzapur, a popular web series. And ironically, Downdetector, a website that helps users find which website is down or not, was itself down! Another user asked @Cloudflare whether it had tried turning it off and on again.
