Zinger Key Points
- The sudden and anomalous spike likely stems from low liquidity in the Bitcoin/Tether market on Binance.US.
- Binance.US’s market depth has plummeted 76% since May.
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Bitcoin BTC/USD spiked to approximately $138,000 on the Binance.US cryptocurrency exchange today.
What Happened: The surge, which occurred specifically in the Bitcoin/Tether trading pair, happened at 6:50 a.m. UTC. It lasted mere seconds before prices realigned with other Bitcoin spot markets, Coindesk reported.
Other Bitcoin trading pairs remained stable during this episode.
Also Read: Institutional-Only Crypto Exchange EDX Markets Debuts With Support From Major Financial Firms
It's highly improbable that a trader intended to purchase Bitcoin at an almost 450% premium, especially when the cryptocurrency was trading just above $29,000 during Wednesday’s European morning hours.
Why It Matters: The sudden and anomalous spike likely stems from low liquidity in the Bitcoin/Tether market on Binance.US.
Market depth data reveals that a $400,000 Bitcoin purchase on this trading pair could elevate prices by 2%. This is in contrast to at least $842,000 needed to produce the same effect on a Bitcoin/USD trading pair.
"Market depth" is indicative of the liquidity available in a financial market.
According to a recent Kaiko report, Binance.US’s market depth has plummeted 76% since May. This drop insinuates that market makers and traders have largely withdrawn from the exchange.
Read Next: Gemini Expands Crypto Horizons In The Asia-Pacific Region, Starting In Singapore
Image: Pixabay
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