MCX glitch hits silver options traders, may attract stiff fine

Four-hour outage halts trading during crucial expiry window, exposes traders to price swings

- Srushti Vaidya & Ram Sahgal

Tuesday's technical glitch affecting the country's largest commodity derivatives bourse, the Multi Commodity Exchange of India (MCX), coincided with the expiry of silver monthly options contracts, sending traders into a tizzy.

It also opened up the possibility of a hefty penalty of ₹25 crore on the exchange, according to Sebi circulars that provide for a 45-minute window to restart operations after a "disaster" is announced, with some relaxation possible in the event of a cyber attack.

A disaster has to be declared within 30 minutes of the incident and the exchange has to restore trading within 45 minutes of the declaration of a disaster. Trading resumed on Tuesday at 1:25 pm, more than four hours behind the scheduled opening of 9 am.

Even after resumption of trading, certain traders reported difficulty in executing orders. "Trading has commenced but we are facing some difficulty, with some orders not going through," said a broking official, requesting anonymity. This, however, was resolved later.