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$629M Wiped Out! What’s Behind Bitcoin’s Steep $850 Drop over the Night

Bitcoin took a sharp nose dive, plunging $850 shortly in an hour starting around 21:45 UTC, from a high of $10,200 to a low of $9,350. As of press time, the price of bitcoin has bounced a bit back around $9,540.

The plunge of the largest cryptocurrency immediately kicked off a knock-on effect on the crypto market, leading the 10 largest cryptocurrencies by market cap dropping 5% or more, with BCH down 8%, EOS down 12% and the entire cryptocurrency market losing about $20 billion in value within a single day.

More than $629 million worth of long contracts have been liquidated with nearly 20,000 accounts burnt over the past 24 hours. Among them, $100 million were wiped from the contract market of Huobi, $173 million were wiped on OKEx, $171 million from Binance and $182 on BitMEX during the plunge. BTC, ETH and EOS saw the biggest losses with $390M, $94.38M and $69.21M worth of contracts being liquidated.

The cryptocurrency market has been up about 50 percent since the start of the year with bitcoin crossing up beyond the $10,000 mark several times, which led many investors and analysts to argue that prices below $10,000 will never happen again. The reality, however, is cruel.

Earlier that night before the crash, top crypto exchange Binance went down for unscheduled maintenance which forced the platform to pause all the trading activities with futures trading remaining unaffected during the maintenance.

Though Binance CEO Changpeng Zhao was quick to tweet his explanation and accommodations, there still rumors that might fabricated by shorters wanting to take the advantage by causing panic to benefit themselves went around in the Chinese crypto space that the exchange was hacked with 20,000 bitcoin lost.

Following the Binance maintenance news, the South Korean crypto exchange Upbit was rumored to have suspended withdrawals and blocked foreign accounts, which has not yet been confirmed as of press time.

Still, many investors remain optimistic about the future of the crypto market, believing that “the market as a whole is still on the upward trajectory as bitcoin halving draws near, but short-term fluctuations are inevitable, in this sense, highly leveraged transactions are dangerous during this period”.

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