A 5,000 BTC dump on Bitstamp likely caused the bitcoin price flash crash that occurred during the early hours (UTC) of Friday (May 17, 2019). Bitcoin plunged to as low as $6,100 on the exchange but has since recovered over $7,000 over the past few hours.
Whale Dump, ‘Fat Finger Error,’ or Bot Glitch
A trader on the Bitstamp exchange reportedly put up a sell order of 5,000 BTC at an oddly low price of $6,200. This move caused a massive price plunge on the exchange, setting up a temporary arbitrage opportunity.
The effect soon spread across the market to other exchanges with the BTC market average falling to about $7,100. As at press time, Bitcoin had rallied to $7,300 on most of the popular BTC exchange platforms.
Details are still hazy at this point but there are three likely theories for what happened – a whale dump, fat finger error, or a bot glitch. However, given the lack of significant volume variance at the time of the crash, it seems unlikely that the crash was as a result of a deliberate dump.
On the flip side,…
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Source: https://thebitcoinnews.com/bitcoin-price-flash-crashes-to-6-1k-heres-the-likely-reason-why/
