Binance Blames Trading Algorithm Bug for Bitcoin Flash Crash

Hours after Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term’s flash crash to $8,200 on Thursday, Binance officially confirmed that the incident happened because of a bug in the trading algorithm of one of its clients.

“One of our institutional traders indicated to us that they had a bug in their trading algorithm, which appears to have caused the sell-off,” the exchange wrote in an email to many media houses.

“We are continuing to look into the event, but understand from the trader that they have now fixed their bug and that the issue appears to have been resolved.”

The flash crash happened on Binance’s US affiliate, Binance.US, precisely at 7.34 am New York time, according to the exchange. The effects of the plunge were seen on other crypto exchanges as Bitcoin price on rival Kraken sank to $54,000 momentarily before recovering quickly.

In the overall market too, the price of Bitcoin stepped back from its record high of above $66,000, settling between $62,000 and $63,000.

Extreme Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term Warning

Coincidently, the flash crash on Binance.US happened after Binance Founder and CEO Changpeng Zhao recently warned investors about possible high crypto volatility in the coming months.

“Expect very high volatility in crypto over the next few months,” Zhao wrote on Twitter.

Flash crashes on the crypto market, or other trading markets, are not a new phenomenon. Several other top crypto exchanges have suffered such incidents, mostly due to platform glitches.

Meanwhile, the first Bitcoin futures ETF has been listed on the US stock exchanges earlier this week that is considered to be a milestone in the crypto space. Its positive effect can be seen from the high demand for the instrument that has resulted in the crypto touching a record high.