On April 26, the price of Bitcoin $29,176 plummeted by about 7% in a single hour, dropping from $29,850 to $27,789. According to media reports, this was because blockchain analytics company Arkham Intelligence erroneously sent out a warning that wallets connected to Mt.
Gox and the U.S. government had started moving sizable amounts of Bitcoin.
Initially, Arkham tweeted to affirm that the reported error had been caused by a “bug fix” that had caused a misleading warning to be sent out on their analytics platform to a “small subset of users.” The well-known crypto news alert account DB or Tier10k later tweeted about the notice.
Nevertheless, an hour later, Arkham tweeted that it had “conducted an investigation of the DB Alert situation and determined that the Arkham alerts were sent accurately in this case.”
“Neither the alert nor the tweet could have caused the sharp BTC price drop today,” stated Arkham, pointing out that the decline took place between 19:17 and 20:01 UTC, while the alerts and the tweet were delivered at 20:07 and 20:08 UTC.
Additionally, no transfers have been made from wallets linked to Mt. Gox, per the information shared on Twitter by IT Tech, raising the possibility that Bitcoin’s flash crash was caused by factors that were not yet known to market players.
A Bitcoin address thought to be the U.S. government’s wallet holding the money from the Silk Road theft, according to data from blockchain explorer Blockchain.com, did see a transaction on April 26. But at the time this article was being written, it was simply an inward transaction valued at $0.19.
Whatever the reason for the flash crash, the fast and sharp drop in prices wreaked havoc on the derivatives market, with the current total of liquidations for participants in the crypto market surpassing $211 million. These liquidations totaled about $97 million, all of which came from Bitcoin dealers.
According to information from the Cointelegraph Price Index, Bitcoin was trading for $28,378 at the time of writing, up 0.25% over the previous 24 hours. Miguel Morel, CEO of Arkham, was contacted by Cointelegraph for comment on the situation, but he has not yet responded.
Disclaimer: The information provided is not trading advice, Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.