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Cheap BTC: Bitcoin Suddenly Drops $1,000 On Kraken Exchange In a Flash Crash

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In a flash crash event, bitcoin plummeted in price on Kraken today. Crypto’s largest asset quickly rallied, however, providing one massive lower candle wick for price action.

Bitcoin dove more than $1,000 on Kraken’s crypto exchange on April 25, as seen in the chart below. The price provided a catastrophic wick, from around $5,400, down to $4,357, and subsequently rallied right back up to a normal trading range. The whole whiplash event occurred within five minutes or so, involving a trading volume of more than 1,500 Bitcoin in that period, as can be seen on the following 30-minute candle chart.

xbt_kraken_30m-min

The severe drop in price may have triggered traders’ stop-loss zones, causing trade closures and losses. Some traders, however, may have caught lucky breaks, snagging a few low price bids. Twitter user Crypt0mer claimed to have hit a couple of excellent BTC trade entries from the event.

Long History of Flash Crash Events

On April 17, a similar event occurred on Binance for Waves cryptocurrency. The asset dropped a staggering 99.9% within a single hourly candle, according to CryptoPotato’s coverage on the news.

Additionally, Kraken itself saw another similar event back on September 4 of 2018, with Ethereum falling more than $40 in an instant. The exchange saw 18,000 ETH sold and bought within one minute.

December 6, 2018, also saw an Ethereum flash crash on Coinbase Pro when the asset dropped from around $100, down to $13.05, and then back upward again, as reported by CryptoPotato.

btckraken
Another view, the daily chart. Source: Coinigy

Such flash crash events can have many causes, ranging from bot trading to big players hitting large market orders. However, there is always a positive side: Think of the ones who had low orders on Kraken’s order book who made a quick 22% on their filled positions. As mentioned in our crypto trading tips, sometimes it’s wise to leave low orders.

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