October 31, 2025

Mumbai was buzzing on October 31, 2024, but Multi Commodity Exchange (MCX) traders hit a wall with a shocking 4-hour outage that stopped trading dead in its tracks. Why? A huge flood of traders crashed the system’s capacity, causing what insiders call a “capacity breach.” Two sources, speaking on condition of anonymity, revealed this to Reuters on Friday. MCX’s system couldn’t handle the massive number of unique client codes, reaching beyond its set limits. Though the exchange assured that its trading systems are stable overall, the shutdown sparked waves of frustration. “Had MCX early on Tuesday identified that it was facing a capacity breach, trading could have resumed much faster,” one source said bluntly. The Securities and Exchange Board of India (SEBI) didn’t reply to queries but is reportedly unhappy because MCX took too long to find the problem. Usually, when a trading halt happens, SEBI demands switching the activity to a backup disaster recovery site. This time, however, the problem followed the exchange there due to the overwhelming trading volumes. MCX admitted to the issue, noting that predefined limits on 'unique client codes' caused the glitch, but they say steps are underway to prevent a repeat. The outage wasn’t just a technical headache; it hit traders’ pockets hard. Bullion traders scrambled as gold and silver prices dropped globally. Many who wanted to exit their long positions fast found themselves trapped in a system standstill. A Mumbai bullion dealer lamented, “Gold and silver prices were correcting in the global market. Everyone, including us, who held long positions wanted to exit quickly, but we couldn’t.” The trading halt’s ripple effects forced many traders to turn to the India Bullion and Jewellers Association Ltd (IBJA) to fight their corner with the regulator. According to an IBJA official who preferred to stay unnamed, such delays and halts on MCX have become more frequent this year, gnawing away at traders' confidence and wallets. The drama on the floors of MCX serves as a sharp reminder of how a sudden spike in demand can push even big market players to their limits, raising tough questions on how India’s exchanges prepare for the future.

Read More at News →

Tags: Mcx Outage, Sebi Penalty, Trading Halt, Commodity Exchange, Bullion Traders, India markets,