Crazy premiums on crypto exchanges during the Bitcoin Price Crash
Today's massive price drop on bitcoin was largely expected by analysts. The bearish descending triangle formation had to break out to the downside, so there has been no real surprise. What the move has revealed, however, is huge price differences between different crypto exchanges.
Bitcoin Premiums Abound
It looks like the digital dust is settling after bitcoin's $ 1500 dollar dump a few hours ago. A cascade of sales signals was triggered as soon as the asset fell through support for $ 9,500. This created a massive red hour light that dumped $ 900 in just 60 minutes. The panic continued as the BTC fell further, touching long-term support of $ 8,000 before a wall of purchase orders was executed, pushing it back upwards of $ 500.
At the time of writing, buyers were unable to overcome the $ 8500 newly formed resistance zone and analysts were predicting further losses. What emerged during the violent couple of hours was very variable prices on various exchanges around the world.
Crypto trader 'hodlonaut' noticed a lot of action on Coinbase;
“Some gather like crazy on Coinbase. Big purchase at a huge premium ”
Some gather as crazy on Coinbase. Big purchase at a huge prize
̵[ads1]1; hodlonaut?⚡? (@hodlonaut) September 24, 2019
Analyst Josh Rager confirmed the Coinbase prize.
$ BTC $ 400 to $ 500 premium on Coinbase [19659004] – Josh Rager ? (@Josh_Rager) September 24, 2019
And fellow crypto expert Alex Krüger also observed the huge spread between exchanges.
“Wild $ 600 wide spread between Bitmex and Coinbase. $ 8150 vs $ 8750 ”
Wild $ 600 wide spread between Bitmex and Coinbase.
$ 8150 vs $ 8750
– Alex Krüger (@krugermacro) September 24, 2019
Coinbase seemed to be the worst offender, but then it has some of the highest fees in the industry and is more gains driven than other stock exchanges, so hardly surprising.
Arbitrage between stock exchanges would have netted some neat gains for those quick enough to respond. It was also pointed out that discrepancies such as these are partly to blame for the lack of adoption for bitcoin. However, Satoshi did not have the stock exchanges in mind when he drew the currency that was primarily to be traded peer to peer.
A few hours later, it appears that things have settled between the stock exchanges with Tradingview.com which reported only a $ 25 difference in prices between Bitstamp, Coinbase, Bitfinex, Bittrex and Gemini. On Japan's BitFlyer, the price for BTC was slightly higher at JPY 926,799, which worked out to $ 8,636.
Speculation about why bitcoin dumped so hard today is currently growing. CNBC's Ran NeuNer remained confused .
I am a member of several Crypto chats / WhatsApp groups (none paid) – Some of these chats have the biggest whales and crypto names on the market … and not a single one has any idea what happened today!
Others have fingered the FED flood in the US cash markets, the bitcoin hash rate crashed, and other technical signals that conclude, but the point is that this has happened before and will happen again.
Did you use bitcoin premiums on stock exchanges? Add your comments below.
Photos via Shutterstock, Twitter @hodlonaut @krugermacro @Josh_Rager
