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The notable crypto exchange, Kraken, has experienced yet another flash crash, following one last week in which the price of Bitcoin fell by $500 (USD). June 1st brought another for the exchange, this time between the Bitcoin and Canadian dollar pairing which saw bitcoins price plummet 99% to little over $100 (CAD)…
The crash was noted by quite a few within the crypto circles of social media, who, rather than question why simply wished they had set lower buy orders.
#bitcoin flash crashed to $100 on @krakenfx yesterday.
— Nick Cote (@mBTCPizpie) June 2, 2019
Just saw this.
Imagine getting that fill. pic.twitter.com/cV5nW07uYE
Ugh I need to actually set some stink bids on illiquid exchanges
— Andrew Weiner (@DickeyNate) June 2, 2019
The crash took BTC from its typical range of around $11,200 (CAD) to just $101 (CAD) in a matter of minutes. Ironically, order set just below at $100 missed out by just one Canadian dollar … The lesson? Never get too greedy.
The price instantly pumped back up, leaving little more than a red wick trailing all the way down to the depths.
A Reddit thread discussion the flash crash offered up a few explanations as to why the crash might have occurred:
One user suggested that someone accidentally put in a large sell order for a low price:
As reported last week, Kraken already saw a flash crash of a slightly different magnitude, with BTC falling just $500 from $8722 to $8200. It is thought that someone potentially sold a large amount of BTC $500 below market price, however, some believe that some market manipulation had a hand in the crash.
Speaking on the crash, exchange boss Jesse Powell tried to allay fears as to whether the drop was an inside job…
“I think the community has already answered but what keeps us from trading against/front running our own clients is 1. It’s bad for business 2. It’s immoral. An orderly market is one that does not prevent you from making the trade you want to make. We welcome government liquidity.”
What do you think? Is Kraken at fault here? Or is this a repercussion of a nascent market? Let us know your thoughts in the comments below!