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BitMEX experiences "flash crash" in Ripple contract, dropping 144% overnight before quickly recovering to normal levels

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BitMEX experiences "flash crash" in Ripple contract, dropping 144% overnight before quickly recovering to normal levels

While the overall market was generally in a bullish trend, the Ripple (XRP) futures contracts on the derivatives exchange BitMEX plummeted overnight from 0.34 to 0.13 magnesium, leading to many traders being liquidated. BitMEX has not responded to this incident.

Table of Contents

  • $16 Million Liquidated
  • XRP Futures Contract Launched Less Than 10 Days Ago

According to data from Coinmarketcap, XRP did not show any abnormal price movements last night, with a 1.66% increase in the past 24 hours and a price of $0.325 at the time of writing. As BitMEX saw a large number of contract users being liquidated, the crypto community took to Twitter to express their discontent with BitMEX.

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As reported by ABM, Bitcoin has surged by 41% since January and recently broke $10,400. Competing coins like Ethereum, Ethereum Classic (ETC), and Tezos (XTZ) have also seen a resurgence, with higher returns than Bitcoin, leading many investors to anticipate the upcoming season for these competing coins.

However, the volatility of competing coins is often higher than that of Bitcoin, resulting in frequent extreme price fluctuations. BitMEX recently launched XRP perpetual swap contracts with leverage as high as 50x, naturally increasing trading risks.

Similar to what happened on BitMEX last night, due to a significant drop, XRP plummeted from $0.34 to $0.13 within less than a minute, causing users' automatic stop-loss orders to fail to trigger.

https://twitter.com/JacobCanfield/status/1227958454343675908?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1227958454343675908&ref_url=https%3A%2F%2Fdailyhodl.com%2F2020%2F02%2F13%2Fxrp-price-plummets-on-crypto-exchange-bitmex-crashing-58-and-triggering-liquidations%2F

BitMEX CEO Continuously Disparages XRP

BitMEX CEO Arthur Hayes previously tweeted when launching XRP contract trading:

Is it called Ripple, XRP, or dog s**t? Who cares? It's worth more than zero so it's time to trade the USD pair on BitMEX.

He once again criticized XRP on Twitter yesterday, stating:

Shorting XRP, professional tip: Long or short, it's all the same if you're trading s**tcoins.

Events like these price flash crashes are always a mix of joy and sorrow. Apart from users who were liquidated due to the inability to set stop-loss orders, there may also be those who happened to hold funds and bought long positions at extremely low prices, doubling their assets within seconds.

Similar events have occurred in the past. In 2017, Ethereum on the GDAX exchange once plummeted from $317.91 to $0.1 due to a multi-million dollar sell order, only to quickly rebound to over $300.

Given the high volatility and risk of crypto assets, traders should never invest funds they cannot afford to lose in a single trade, as the next moment in the cryptocurrency market is always unpredictable.

Further Reading

  • BitMEX Launches XRP Perpetual Swap Contracts, Spot Market Sees Price Surge
  • Competing Coins Making a Strong Comeback? Bitcoin Market Dominance Drops to Lowest Since June Last Year

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