Massive Sell-off In Cryptocurrency Markets Causes Coinbase to Temporarily Disable Services
Bitcoin prices took a dive yesterday as the cryptocurrency plunged by more than 30% in a week time. From a high of around 19.9k on Dec. 17, a day before CME’s Bitcoin futures contracts went live, the price fell to as low as $12k yesterday, according to our data.
Earlier this week, there was a lot of strength in the market with the crypto market crossing $600 billion in overall market valuations for the very first time. Along with Bitcoin, there were other major altcoins like Ethereum, Litecoin and Ripple who contributed to this rally.
However, as many had warned regarding an existing bubble in the market, a correction was soon witnessed as the market started moving sideways. In just past 48 hours, Bitcoin has corrected by more than 30% before finally resuming to move upwards and is seen currently consolidating at around $14k.
During this correction, there was a massive sell-off for Bitcoin with a huge rush of investor orders. As a result, the largest cryptocurrency exchange in U.S. - Coinbase had to suspend trading activities for a temporary period of time.
At 11:11 a.m., ET, Coinbase wrote on its status websites saying "Investigating - All buys and sells have been temporarily disabled. We are working on a fix and apologize for any inconvenience.”
In an additional statement, it further said that "due to today's high traffic, buys and sells may be temporarily offline. We're working on restoring full availability as soon as possible.”
Coinbase mobile app is one of the most widely used apps on the Apple app store and allows users to buy or sell many different cryptocurrencies like Bitcoin, Ethereum and Litecoin. Earlier this week, Coinbase added support for the first Bitcoin derivative - Bitcoin Cash following which there has been huge buying of the cryptocurrency as it managed to hit a new all-time high above $4k.
At that time too, Coinbase has to suspend its operations sighting to issues of a possible insider trading which the company said that it will investigate the matter is some time soon.
With a huge participation of retail investors in the cryptocurrency markets, Coinbase has over 13 million registered users on its exchange. Moreover, in the past two months there has been a sudden surge in traffic as the crypto markets were surging at an unprecedented rate to reach a record-high valuation above $600 billion.
However, Coinbase has faced this issue second time in past 20 days. As reported by CNBC earlier, the exchange had to suspend trading in Ethereum not once but twice in one single day when the cryptocurrency was climbing post $800 levels.
This is for the second time such an issue has been reported. Going further, as more investors join the crypto markets, the traffic is surely going to increase and hence exchange have to work on such issues to make sure that they don’t occur quite frequently.