With the current market recovering from the recent pullback of Bitcoin[ BTC] dragging Bitcoin’s price below $7,500, a source hunt has followed. Bitstamp, the Japanese cryptocurrency exchange that saw the market’s tremors in a crucial order setting, is the prestigious source, but some dispute that claim.
Correction or Manipulation?
In view of the news that a massive sell order of around 5,000 BTC was placed on Bitstamp, the term “manipulation” was also thrown around. The order was executed at a low $ 6,200 price, while the coin’s market price was well above $ 8,000, which caused the decline.
The deterrent Bitstamp catalyzed the rampant liquidation of more than $ 207 million in long positions by BitMEX. BitMEX prices also crashed briefly since the latter’s price index consisted of BTC’s weighted price on Bitstamp and Coinbase Pro.
Rumors of manipulation were fuelled by the transaction’s individual nature that triggered the crash. In addition, since the April ascendancy of over $ 5,000 was supposed to be initiated by a single automatic purchase order of a substantial amount of Bitcoins, rumors of manipulation can not be waived.
Dovey Wan, the co-founder of Primitive Ventures referred to the person behind the event as a “jackass” who “put up an aggregated sell of 5,000 $BTC on [Bit]stamp”.
Regardless of the similarity between the culprit and a farm animal, the aim of the pullback was not yet determined whether it was planned or down to market forces, but notable analysts have thrown their hat into the ring, suggesting no foul-play.
Weiss Ratings, the crypto-specific ranking company that sometimes rubbed the cryptocurrency industry in the wrong way on predictions, suggested a lack of “manipulation” and called the fiasco a “normal correction of the market.” Citing the Bitstamp case and then immediately dismissing it, Weiss emphasized the crash time.
The rating giant said the king coin’s price dropped “25hrs BEFORE” the Bitstamp sell order of 5,000 BTC at a low price of $ 6,200 ; hence this is not a case of manipulation, but rather a plain old market correction. Reading their tweet on May 17:
“Today, the price of #Bitcoin abruptly sank more than 20%. Some say this was due to manipulation. #BTC had been going down for 25hrs BEFORE the big order hit at #Bitstamp. This isn’t manipulation – it’s a normal market correction. #crypto #cryptocurrency #altcoins”
No doubt the Bitstamp order hit the market hard, not to mention the consequences it had on the BTC-BitMEX market, given the gravity of the exchange and the severity of the order. The top cryptocurrency, however, has been able to hold firm above $7,000 and is now well above the $7,300 mark and moving upward.
Whether it was a price manipulation induced by “jackass” or a periodic market correction, the pullback seeks to subside in the past 24 hours with the king coin posting a 1.2 percent price gain over the dollar.