A bug on the Coinbase exchange wreaked havoc on the Bitcoin market, causing the market to lose around $100 billion in value in minutes. The unexpected and abrupt issue sent shockwaves through the cryptocurrency community, leaving many traders reeling from the abrupt price drop.
The event happened quite quickly; in less than an hour, Bitcoin values fell from a peak of $64,300 to about $59,461. Many investors were unprepared for the sharp drop in value, which sparked widespread panic selling as traders hurried to liquidate their shares to reduce losses.
Eric Balchunas, a Bloomberg analyst, said that all the trading volume of BTC ETF like BITO accumulates to $10 billion. This development was followed by a $64,000 increase in the price of BTC, amounting to an all-time 2-year high. Some expert predictions believe that this development won’t last because of the massive profit-taking it has triggered over time.
Bitcoin Traders Recount Losses, As Traders Point Accusing Fingers
Commenting on the topic, Abdulkarim Abdulwahab, a market watcher from Coin Edition, explained that although these major cryptocurrency exchange platforms provide consumers with accessibility and convenience, they also prone to failure due to malfunctions and technical problems.
The approval of the BTC ETF in the United States has also been linked to the recent price increase in BTC, which has also affected its trading volume. On Wednesday, February 28, approximately $7.69 billion was traded, thus breaking its former benchmark by half.
James Seyffart, a prominent cryptocurrency analyst with Bloomberg ETF, acknowledged the development, saying that BlackRock’s iShares Bitcoin Trust (IBIT) increased by 43.5% in net volume, with a $3.35 billion, doubling its former daily record. The Grayscale Bitcoin Trust (GBTC) has been ranked the second BTC ETF with the most inflow after recording a trading volume of $1.86 billion.
Report Says Glitch Happened When BTC Neared All-Time High
Martin Hiesboeck, a popular figure in the cryptocurrency community and the head of research at Uphold, a United States-based exchange, has accused Coinbase of having something to do with the recent event. According to Martin, Coinbase has a case to answer regarding the recent glitch in its network.
Coinbase, through its team, took to the company’s official X handle to confirm the event, saying that they’re aware that most of their users witnessed a zero balance on their Coinbase dashboard. In contrast, others may have encountered some difficulty when trying to buy or sell.
While some believed that market manipulation or coordinated trading activity intended to take advantage of the vulnerability in Coinbase’s system may have been the cause, others believes that technical problems or software defects might have been to blame.
Hiesboeck explained that the tragic hour’s events has been described as a sobering reminder of the dangers and unpredictability present in the cryptocurrency space. The Coinbase team apologized for the technical error and promised to resolve the issue promptly. News has it that the glitch happened when the BTC was only 10% to hit an all-time high, a development that sent shock among investors and traders.
Coinbase CEO Comments, Address Current Issue
As of the time of the report, the BTC trades at $62,627.55 after moving up by 5.70% on February 29. The cryptocurrency market capitalization had increased to $1.22 trillion after recovering from its initial losses earlier this month.
On the other hand, the market capitalization of BTC has seen a 105.26% increase to reach $92.27 billion. Brian Armstrong, the current Coinbase CEO, has linked the glitch to the enormous inflow of cryptocurrency into the market, thereby causing explosive traffic.
Armstrong took to the X platform to encourage its users, assuring them that the app would soon get back on track. Armstrong also assured that the Coinbase team is ready to handle the 10x increase in volume. The CEO also appreciated its users for bearing with them, highlighting the huge cost of maintaining both the app and website versions.
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