In regards to the trading passes being disabled - that isn't some sort of glitch or "break down" of the system.
Gaia will disable TPs whenever something fishy pops up.
Ie - glitched gold, botted gold, glitched items, etc. etc.
Such as with the HYYPE case.
Gaia will disable the TPs of all those involved in order to keep the "bad" gold / items from being passed around too much. If they localize it in one spot, they can more effectively and efficiently handle the situation - it's easier to catch this when it's only passed 2 or 3 accounts versus 10 or 15.
More times than none, the transaction is "reversed" in a way and whatever glitched / botted item / gold was used or passed around is destroyed / removed.