The price of bitcoin has fell below $700 on 21st June,dropped more than 10% in an aggressive correction to recent gains.
The decline came just a day after price passed 780$ raising a 28 months high,it is good for this digital currency but investors doest feel the same.
The trading outage at Hong Kong based bitcoin exchange Bitfinex announced the outage at roughly 9:30UTC,the bitcoin was down approximately 3% for the day . But by 13:45 UTC, the digital currency has fallen to about 650$ more than 10% below the days opening price.
Still, while the outage at a high-profile exchange likely contributed to the day’s developments, others described a more complex situation in which key price indicators proved vulnerable to changes in perception.
Bitfinex Users were clearly very unhappy with this outage and expressed their views on reddit.One of them shown his disappointment calling it a crime.
He actually explained the situation of exactly what happened..
When btc price started getting down.At the time when it was 715$, the site shut down and also disabled the withdrawals as well and site was down for several hours and opened again when btc price dropped down to 650$,about 10% down of the days opening price.
That caused loss for them as they also disabled the withdrawals so they were not able to trade on other exchanges as well.
Clearly with his comments on reddit he was really frustrated and angry with what happened.
Others users also unhappy with this outage and shown their disappointment.
Another user said “Bitfinex and other’s behavior today was not optimal. It was also light years of progress from where we were last rally. They must evolve their platform to compete with the next generation of systems. Systems built with scaling, hardening, performance, usability…all from the get-go.Adapt, or die
Most users were clearly disappointed with that some users tried to calm down by giving different explanations but clealy that was not a good gesture shown by bitfinex.
Some expert views for that bitfinex outage:
Once bitcoin’s price began falling sharply, this helped fuel a “powerful long squeeze” that drove prices down further, said Zivkovski. As a result, he posited that “a snowball effect ensued”.
Max Boonen, founder of market maker B2C2 Ltd, also weighed in on bitcoin’s sharp drop, stating that the outage affected traders who held short and long positions.
“The lower the price went after the outage, the larger the margin calls on Bitfinex when they would reopen,” he explained.
Similarity with Mtgox
Although Bitfinex is now back up, It is not fully clear what exactly happened or what led to this devastating error that sent bitcoin’s price down by $80 in minutes last night. Undoubtedly a full update and investigation report from Bitfinex will follow with traders expected to now question why they should trust an exchange that went down for hours twice within one day, sending the market crashing and whipping out hundreds of millions in value.
Standards in Bitcoin exchanges have considerably increased since the devastating bankruptcy of MT Gox which lost almost one billion dollars as valued at the time. There have been considerably less hacks and monetary losses, especially since last year, but as today’s events show, there are still signs of what may be considered amateurism and what may have been carelessness as the market continues to lack a professional exchange that offers margins or futures, partly due to the snail speed movement of regulators.