Two days ago, the cryptocurrency market cap went from $330 Billion to about $280 Billion in less than a day. You can see in the chart above, the top 7 coins all got slammed. In fact, of the top 50 coins, only Tether was up, and that was only by .01c. Of course Tether is a whole other story.
Two days later, the market cap has returned to $320 Billion.
So what happened?
Reports are that a whale had a huge sell order at $11,400 for Bitcoin, and within an hour, the price had dropped to $9200.
So how can 1 person have create a $50 Billion swing in the whole crypto space?
The problem is that because of the decentralized nature of cryptos, and specifically Bitcoin, the coins are traded on many exchanges, in many different currencies. There are more than 20 Bitcoin exchanges, and the prices can vary by up to $1000 on any given day. You can track the exchange prices here:
Bitcoin might trade $5-10 Billion a day, but that is spread out among all of the exchanges. With the largest exchanges trading about $1 Billion/Day, a trader(whale) with $100 Million deposit could easily manipulate the single exchange, and cause a ripple effect in all of the other exchanges and other cryptos.
At prices above $10,000 per Bitcoin, you better be comfortably with swings of $2000 in short periods of time.
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