Recent crypto market crash triggered by one single whale?
- The whale dumped 15,000 ETH (~$4 million) on Bitstamp which is infamous for its illiquidity.
- This sell-off spread to the BitMEX ETH futures contracts, which base a third of their price on the Bitstamp exchange.
Tyler Swope from YouTube channel Chico Crypto reported that the recent crypto market crash was triggered by a single crypto whale trying to manipulate the market. This whale had sold 15,000 ETH (~$4 million) on Sunday which caused the market to go in a tailspin.
“They put in a mass-market sell of 15,000 ETH on Bitstamp, which plunged the price immediately from $270 to $190 – a flash crash.
Now, these flash crashes on Bitstamp are a common thing and they have happened many times since the launch of the BitMEX futures exchange. Why? Because the price data for the contracts is pulled from just a few exchange: Bitstamp, Kraken and Coinbase Pro. These exchanges have lower levels of liquidity…
Like a disease, the sell-off spread into the BitMEX ETH futures contracts, which base their price 33% on the Bitstamp exchange. And many contracts were liquidated in the blink of an eye. The contagion spread into Bitcoin and the entire crypto markets, resulting in the dump we saw on Sunday.”
A Twitter user named HuntingIsland tracked this trade on Twitter saying:
"In case you didn’t know, the entire selloff yesterday was triggered by market manipulation.
A market dump of 15,000 ETH on the illiquid Bitstamp exchange caused a sell-off on Bitmex and from there the rest of the markets via contagion."
Author
Rajarshi Mitra
Independent Analyst
Rajarshi entered the blockchain space in 2016. He is a blockchain researcher who has worked for Blockgeeks and has done research work for several ICOs. He gets regularly invited to give talks on the blockchain technology and cryptocurrencies.
