Bitcoin prices gained $300 in less than one minute August 22 in a leap the cryptocurrency community is broadly attributing to Hong Kong trading platform BitMEX going offline.
Bitcoin Hits $6750 In Record Time
Data from various price trackers confirms Bitcoin’s increase to $6750 occurred almost simultaneous as BitMEX began a period of scheduled maintenance.
The maintenance ran from 0100 UTC to 0200 UTC Wednesday, during which time BTC/USD 00 hit a peak of $6850 before correcting to around $6680, where it has since remained.
On Twitter, BitMEX said it had encountered additional problems with its login process, as well as a DDoS attack which had delayed the full restoration of its platform’s functionality.
Major trading platforms have been indirectly at the heart of the controversy over sudden Bitcoin price moves before.
Earlier this month, settling of futures contracts on Chinese exchange OKEx sparked alarm after executives reported manipulative behavior close to the settlement date. A forced liquidation of contracts worth around $416 million at the time coincided with Bitcoin losing $500 in a matter of hours.
‘Fully Unregulated Market’
Preempting the upheaval surrounding BitMEX’s maintenance meanwhile, entrepreneur Alistair Milne correctly called the sequence of events, arguing Tuesday that “stranger things have happened” than a platform’s downtime moving markets.
Massive Bitcoin short squeeze to coincide with BitMex downtime tomorrow?
Stranger things have happened …
— Alistair Milne (@alistairmilne) August 21, 2018
In comments post factum, economist Alex Krueger meanwhile delivered a more somber opinion on the BitMEX implications regulators greenlighting a Bitcoin exchange-traded fund (ETF).
“The (Bitcoin) lightning +7% breakout during Bitmex’s downtime shows why odds of SEC approving the CBOE bitcoin ETF proposal should be close to zero,” he wrote on Twitter.
Even if no manipulation (that’s debatable) this stresses the importance of Bitmex, a fully unregulated market with 40% market share.
While it remains to be seen if the somewhat inorganic uptick will last, the event had the knock-on effect of lifting Bitcoin out of a sideways trading pattern which had lasted over a week.
During that time, prices remained rangebound between $6100 and $6450, with a single exception of a temporary dip to $5950 August 14.
Prior to that, a larger green candle in mid-July produced a full two weeks of enthusiastic price growth for Bitcoin before sentiment waned, dragging BTC/USD back from highs around $8500 to its starting position closer to $6400.
Earlier this week, Bitcoinist reported on market opinion from UK investment platform CoinShares, CEO of which Ryan Radloff suggested all major Bitcoin price highs were caused by individual investors.
What do you think about BitMEX’s effect on Bitcoin prices? Let us know in the comments below!
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