Bitcoin crashes from libra high after Coinbase outage
Bitcoin sank almost $2,000 to give up gains last night as volatility returned after the cryptocurrency approached $14,000.
Read more: Bitcoin surges towards $13,000 thanks to Facebook libra
Facebook libra’s launch had buoyed bitcoin, pushing the price up until it was just shy of $14,000 last night, its highest level since January 2018.
But over the course of a few minutes that all changed last night, as the cryptocurrency dropped to $11,950, according to Bitstamp.
It fell again this morning to stand at just $11,383 at 10.15am before pressing higher to $11,670.
Craig Erlam, senior market analyst at Oanda, underlined the volatility as he called crypto a “wild market”.
“I wouldn’t be surprised if bitcoin ends the day in the green,” he added.
The sudden crash has been linked to US crypto exchange Coinbase suffered an outage yesterday, coming just minutes after the technical issues began.
“It’s a reminder just how influential one exchange is and therefore how sensitive prices are to these kinds of outages,” Erlam said.
Meanwhile chief market analyst at IG Chris Beauchamp offered a more optimistic take on events, saying the “direction of travel is clear”.
“The short-term pullbacks of April and early June [are] likely to be replayed in the coming weeks,” Beauchamp said.
“Bullish momentum remains strong, with Facebook’s libra move providing the fundamental rationale for a revival of hopes for the future of cryptocurrencies.”
Facebook’s libra currency was credited with sending bitcoin’s price soaring since social network founder Mark Zuckerberg launched the currency last week.
Experts are hopeful that Facebook’s entry into the crypto market could help digital currencies find wider acceptance and legitimacy.
Bitcoin’s current market capitalisation stands at $210bn, down 6.8 per cent from the $224bn it enjoyed yesterday, according to Coin Market Cap.
Read more: Bitcoin pulls back from 18-month high
Fellow cryptocurrencies Ethereum and XRP felt steeper falls, down 10.2 per cent and 12.4 per cent respectively.