- The Bitcoin price fell to $3,660 in early Asian trading (3 a.m. UTC) and caused a breakdown of some exchanges such as Huobi or Bithumb.
- Within a few minutes, Bitcoin managed to climb back to $5,200 and has been trending sideways ever since.
The Bitcoin price fell below the important $4,000 mark for a short time this night, to $3,660. At this level, many traders had placed buy orders, so the Bitcoin price rebounded to $5,200 within minutes. Within the last 24 hours, BTC nevertheless shows a negative record of – 32.95%, to a price of $5,170.55.
Two leading exchanges in the Asian market, Huobi and Bithumb, reported a system breakdown because the influx of users led to an overload on both platforms. Trading was suspended and cryptocurrencies could no longer be withdrawn. A few hours ago, however, both exchanges announced that all technical problems had been solved and all functions were running smoothly again.
The BitMEX derivatives exchange also experienced a drop-out at the low point of Bitcoin, which lasted over 10 minutes and rendered traders unable to act. Meanwhile, criticism was voiced by Sam Bankman Fried, CEO of the research company Alameda, that BitMEX should have been responsible for the sharp drop in prices. In his opinion, BitMEX did not prepare itself sufficiently for such extreme market conditions and deliberately left its users “standing in the rain”.
BitMEX reacted to the accusation and described its statement as a “conspiracy theory”, pointing out the possible complications that could arise along such extreme scenarios. The experienced Bitcoin trader Josh Rager shared the 1-minute chart on Twitter:
In case you didn't get to experience the Bitmex lag for 10 minutes
Here's the 1 minute Bitmex chart to enjoy pic.twitter.com/7YtatJ2XOp
— Josh Rager 📈 (@Josh_Rager) March 13, 2020
The subsequent price increase from just under 3,600 USD to 5,200 USD with over 40% growth within a few minutes is a rare event in the crypto market. Rager says:
That’s a massive move for % 40+ % During times of fear, more people sit on the sidelines meaning less liquidity meaning price can be pushed 20% to 40% at a time That’s why you’ll see those moves in Bitcoin.
Multiple billionaire Mike Novogratz explains on Twitter that cryptocurrencies have always been a “game of trust” and at the moment trust in almost all assets worldwide is evaporating:
$btc was always a confidence game. All crypto is. And it appears global confidence in just about anything has evaporated. What brings it back to $btc.
Bitcoin veteran and long-time commodity trader Peter Brandt has been able to predict several major price drops of various assets in the past. With regard to Bitcoin he found clear words that could shake the one or other trader. He describes that with a clear view of the current Bitcoin chart he sees the new bottom “without distortion” at a price “below 1,000 USD”. This corresponds to a further price drop of another 80% at this point in time.
You called bitcoin 5.500. Just curious if this is still bottom or has things changed now Corona is kicking in?
— G70 (@ttiswattis) March 12, 2020
The Altcoins also suffered from the current price crash. Ethereum has fallen to $125.43, XRP to $0.15, Litecoin to $33.56 and Tezos to $1.52. In the wake of the crypto crash, panic selling has put a strain on the Ethereum network, among others, so that average transaction fees have risen to $0.58 and confirmation took up to 44 minutes.
FED and ECB pump multiple market capitalization of Bitcoin into the market
The US Federal Reserve (FED) and the European Central Bank (ECB) have announced further financial injections to cushion the consequences of the global economic crash with cheap money. The ECB decided against a further interest rate cut and will instead buy assets worth 135 billion USD to stimulate the market.
At the moment, Bitcoin’s current market capitalization is just under USD 95 billion, so these figures show the true dimensions of the cryptomarket compared to the rest of the financial system. The development of Bitcoin and the blockchain technology is still in its infancy. It remains to be seen if and when Bitcoin can recover.