Bitcoin experienced extreme volatility overnight, dumping over $2,000 in 15 minutes and causing crypto staple Coinbase to crash, preventing traders from closing out their positions. The sell volume in the move the highest seen this year on most timeframes, topped only by the huge drops in November 2018, showing just how much selling was involved. Given that such a pullback was anticipated however it should not be feared, and should simply represent a natural correction on the way to higher highs as the fundamental status of the asset has not altered.
Coinbase, you ruined the whole party!
— Ran NeuNer (@cryptomanran) June 26, 2019
Pullback on the Cards
According to data from BitMex, nearly $250 million in volume traded hands during a five-minute window surrounding the initial price drop, with nearly $690 million trading across the higher 15-minute time frame after the drop began across its XBT/USD perpetual swap contract market. Bitcoin had been calling for a pullback since Monday, but instead saw a huge upwards move, leading to the cusp of $14,000 and hugely bullish sentiments across the board, including talk of all-time highs being broken. The Bitcoin fear and greed index was at 95 – the highest on record – and history shows that a drop usually follows, although the fact that the talk in crypto communities is still bullish shows that further upwards momentum is still the more likely option once it settles down.
— Crypto Mars (@thecryptomars) June 27, 2019
Did the Coinbase Whale Cause the Drop?
Coinbase customers were understandably annoyed that the platform couldn’t cope with the volume, with some suggesting that the whale who transferred 8,884 BTC to the platform Monday might have sold some or all of his tokens and been the cause of the crash. Coinbase failed to address the issue in their social media channels, leaving many in the dark and worried that the same could happen again.
Binance and Coinbase completely crashed and unresponsive https://t.co/qG3a7IHwBa
— Moon Overlord (@MoonOverlord) June 26, 2019
BTC’s drop coincided with yet more pain for alts, but the fact that it has finally corrected (or at least started to) brings us one step closer to some positive activity in that area, with ETH and BCH of particular interest, although LTC could still see a late surge with the halvening still over five weeks away. With CME monthly futures due to close tomorrow, the markets are definitely in for an interesting 24 hours.