WhatsApp outage hits asset trading from crypto to Russian oil

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WhatsApp’s nearly six-hour outage on Monday hit trading assets from cryptocurrencies to Russian oil, market participants said, although a quick switch to alternative platforms like Telegram limited serious disruptions.

Although many financial institutions discourage their employees from using messaging services like WhatsApp and other Facebook platforms that were discontinued on Monday, their convenience makes them popular with traders communicating with customers in OTC markets.

Facebook blamed an “incorrect configuration change” for the outage that hit WhatsApp, Instagram and Messenger in the largest outage ever tracked by the web monitoring group Downdetector.

Among other things, the BCB Group, a London-based crypto company that offers other services in addition to OTC trading, was affected. Facebook services went dark around noon EST (1600 GMT), an important window for BCB’s dealers.

“The WhatsApp outage hit us in our busiest trading time, in which we are confronted with US counterparties,” said CEO Oliver von Landsberg Sadie.

“The daily volume fell by 15 percent compared to the daily average, which we attribute internally to the connectivity problems. Telegram and Slack-based trading was at the level of the daily average.”

WhatsApp usage among financial traders, tracked by communications surveillance firm VoxSmart, has seen a boom as banks accept that customers want to use the platform even when bosses prefer their employees to use official messaging channels, VoxSmart CEO said Oliver Blower.

The app has become the “standard messaging service” in many markets, particularly in continental Europe and the Asia-Pacific region, added Blower.

Of the approximately 2,000 Interdealer users who sent 10,000 messages a day in the energy market in 2016, VoxSmart now tracks between three and five million messages a week across asset classes, including between banks and buyers.

“Both the volume and content of the messages are interesting. It’s not just about when you go to ‘The Dog and Duck’, but what is your price for a 5-year message?” Said Blower with British pub slang.

WhatsApp to Telegram

Still, the proliferation of messenger services beyond WhatsApp meant that Monday’s outage was more of a nuisance than a major disruption.

In India, for example, the market chatter has shifted to WhatsApp to Telegram, where there are fewer restrictions on the size of group chats. The default also came after markets in much of Asia closed, which limited the impact.

In the Middle East, “the majority of crypto OTC trading is done through Telegram or WhatsApp, where you ask your OTC brokers for a quote and offer and then access and confirm the transaction,” said Zachary Cefaratti, CEO of Dubai Investment Platform Dalma Capital, adding that Telegram is being used more and more.

OTC traders in the oil markets were also affected, although the blow was softened by the use of other platforms.

In Russia, oil traders said WhatsApp is widely used to communicate details of orders across Europe and Asia. The failure on Monday was an “unpleasant surprise,” said a dealer based in Europe.

“It wasn’t nice. Everyone uses it. But we also use alternative messengers, so switched,” said another.

© Thomson Reuters 2021

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