Key takeaways
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Some Altcoins, including the Cosmos atom token, fell soon near Zero in Binance in the Crypto Market crash of Friday.
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Both altcoins will hold the real market value to other centralized crypto exchanges.
On October 10, cryptocurrency suffered its most intense collapse Because the Falling FTXwith a total market capitalization of the market of approximately $ 850 billion within hours.
Bitcoin (Btc) fell around 10-15%, from highs close to $ 124,000 to $ 105,000. However, altcoins are worse, especially those exchanged in Binance, with a lot of collapse of 99.99-100% in minutes.
Including tokens such as cosmos (Atom), IOTX (‘Re), and the machine (Enj), that prices in Binance briefly hit zero.
In comparison, the atom dropped by 53% in rival exchanges, while the IOTX and ENJ slip 46% and 64.5%, respectively. None of them, however, hit the values of zero anywhere else, a phenomenon that was seen exclusively in Binance.
Why did these altcoins fall into zero?
Almost The $ 20 billion worth of crypto positions is liquid During the October 9-10 crash, about 20 times more during the 2020 COVID-19 market route. More than 1.6 million merchants lost their positions while leverage was wiped out.
Many of these entrepreneurs use action (borrowed money) in Binance to boost their income.
Bitmex co-founder Arthur Hayes said the major exchanges, along with Binance, were “liquid collateral tied to cross-Margin positions,” which aggravated the seller.
Simply put, when prices begin to fall, Binance automatically sells altcoins used as collateral to cover losses. This has led to a greater sale of pressure, which pushes the prices even faster.
As the prices dropped, Binance’s trading systems became too loaded. Some users report frozen accounts, stop stop-losses, and delay trading.
At the same time, some analysts said market makers such as Wintermute have withdrawn their funds from Binance because of these delays.
Related: CEO of Crypto.com calls for investigations in exchanges after $ 20B fluids
That means that no purchase orders have been left for a while, so the system has shown a “zero” price for some coins, even though the tokens still have value elsewhere.
A similar “flash crash” happened in 2017, when Ethereum Moment fell to $ 0.10 in GDAX After a flood of automatically seller orders.
Binance issued an apology
Binance Co-Founder Yi He (Chief Customer Service Officer) Issued A apology, which states “some users find issues with their transactions” amid intense volatility and collapse of the platform traffic.
CEO Richard Teng din apologizestating:
“I am truly regretting everyone who is affected. We do not make excuses – we listen carefully, learn from what happened, and focus on doing better.”
Binance said it will pay users of proven losses directly tied to platform or system failures, clarifying that losses resulting from price change or not realized that those gains are not worthy for compensation.
This article does not contain investment advice or recommendations. Every transfer of investment and trading involves risk, and readers should conduct their own research when deciding.
