Home CryptoMarket Bitcoin price flash spikes to $50K on Binance after USD Coin peg snaps

Bitcoin price flash spikes to $50K on Binance after USD Coin peg snaps

by CryptoFan
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The panic caused by the depegage of USD Coin (USDC) from the US dollar appeared out of order, albeit for a few minutes, costing traders $50,000 per Bitcoin (BTC).

Bitcoin price sees $50,000 in ‘fat finger’ error

The BTC/USDC pair on Binance Flash surged to $50,000 on March 12th at 7pm UTC. The reason for the impulse spike is unknown and may be due to “fat finger” trading of large orders.

Binance BTC/USDC hourly chart.Source: Trading View

A potential reason for the flash spike could be due to the thin order book of the newly launched BTC/USDC pair on Binance. The exchange listed the pair just hours before the impulse price spiked.

according to Bitcoin market orders may have eaten up sell orders for pairs up to $50,000, according to a Crypto Twitter trader.

Trading prices of the currency pair returned to market prices of around $22,000 minutes after the spike, suggesting it was an isolated incident. Luckily, the futures market was unaffected by the spot BTC/USDC pair. Otherwise, it could have triggered a massive short-side liquidation.

However, this is not the first time cryptocurrency exchanges have experienced flash crashes or spikes. Multiple exchanges have had similar issues in the past, resulting in outrage and refund requests from affected customers.

RELATED: Deribit to Pay Users $1.3M After Bitcoin Price ‘Flash Crashes’ to $7.7K

In August 2017, GDAX, now called Coinbase Pro, experienced a flash crash, causing the price of Ether (ETH) to plummet to $0.1 due to a customer error. At the time, Ether was trading around $300 elsewhere.

USDC Stablecoin Pegs Restored

USDC’s value fell to a low of $0.87 on March 11 after USDC issuer Circle revealed it had $3.3 billion in exposure to the defunct Silicon Valley Bank (SVB). bottom.

Since the SVB exposure, the USDC trading pair has been volatile on other exchanges. On March 11, Kraken’s BTC/USDC pair surged above $26,000 on concerns over USDC’s collapse.

At the time, USDC was trading at a 10% discount, so Bitcoin was priced at around $22,200. However, the surge towards $26,000 shows that the panic is causing serious volatility.

Uncertainty over the whereabouts of SVB’s depositors heightened anxiety over the weekend. In response, the U.S. Treasury Department, the Federal Reserve Board, and the Federal Deposit Insurance Corporation decided to bail out the customers of SVB and the undersigned banks, rather than shareholders and other stakeholders, and for now Restoring market confidence.

This article does not contain investment advice or recommendations. All investment and trading moves involve risk and readers should conduct their own research when making decisions.