News From The Crypto Currencies Scene

Flash Crash Drags Ethereum From 317 To 0.10

Flash Crash Drags Ethereum From $317 To $0.10

Ether price on Wednesday came crashing down in what is called “flash crash” from an initial $317.81 to $224.48 to as low as $0.10 eventually.

In an over 99.9% fall on one of the largest cryptocurrency exchanges, GDAX, a multimillion dollar sell order was being placed. Since the exchange lacked enough buy orders on its books to accommodate this large a sale, the prices crashed from $317.81 to $224.48.

This initial fall caused margin calls and stop-loss orders, triggering a wave of about 800 automatic position liquidations, slashing the prices briefly to as low as $0.10.

This caused GDAX to suspend trading.

Investors lost millions of dollars due to forced selling of their positions, that could not be recovered despite prices returning quickly above $300.

This incident gives the idea of the cryptocurrency trading ecosystem to be relatively immature, that has been stressed since the start of 2017 by a 20 times increase in daily trading volume without any fundamental change in market structures.

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