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- The massive selloff in ether witnessed by investors on Monday was not an error, CEO of cryptocurrency exchange Kraken, said.
- Instead, “it could be that a single whale just decided to dump his life savings.”
- For roughly one minute, the price of the cryptocurrency plunged to around $700, from $1,628.82 just moments before.
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The massive selloff in the cryptocurrency ether on Monday was not an error, the CEO of crypto exchange Kraken, said. Instead, “it could be that a single whale just decided to dump his life savings.”
The second-largest cryptocurrency by market capitalization saw its price plummet by more than 50% on the exchange at the beginning of the week.
“We’re in the process of investigating,” Kraken CEO Jesse Powell told Bloomberg on Tuesday. “There doesn’t seem to be any evidence of a trading-engine malfunction. It seems like trades processed accurately.”
The ether (ETH) price dipped as low as $1,546.53 from around $1,800, according to CoinDesk data. But on Kraken, for roughly one minute, Ether plunged to only around $700 at 9:20AM E.T., from $1,628 just three minutes prior.
While the “whale” hypothesis is likely, Powell also told Bloomberg that the dip in price could have been made worse by the availability of margin trading and stop-loss orders on the exchange.
"It's still a bit of the Wild West," Powell said. "You still have to do your own research and learn how things work, and you're kind of trading on professional mode on many of these venues."
Across the board, cryptocurrencies suffered on Monday, with bitcoin plunging 17%.
A similar situation is playing out Tuesday, as investors take gains from the record-breaking rally seen in cryptocurrencies this month. The global cryptocurrency market has tumbled 14% in the last 24 hours, data from CoinMarketCap shows.
But some bitcoin bulls, such as Pankaj Balani, chief executive of crypto derivatives exchange Delta, are not bothered. Balani told Insider Tuesday that the downward trajectory of cryptocurrencies is long overdue.