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Flash-crash on Binance exasperated BNB decline

FX Street
Updated:
  • Binance USD experienced a sharp collapse due to low liquidity.
  • BNB/USD dropped to the lowest level since the end of March 2019.

The cryptocurrency market collapsed with Bitcoin and all major altcoins suffered double-digit losses on Tuesday. However he real drama happened on Binance, where the proprietary stablecoin of the exchange – Binance USD (BUSD) –  experienced a flash crash against BTC. For a fraction of time, BTC/BUSD collapsed to $1,800 as the sell-off was allegedly amplified by trading bots and algo-traders.  

Most likely the flash-crash happened due to low liquidity of  BTC/BUSD. The trading pair stabilized fairly quickly, however, someone managed to purchase 20 BTC at a price of $1,800. Due to the small volume, this development did not affect the broader market.  

Meanwhile. Binace Coin (BNB) also experienced a strong selling pressure. BNB/USD has lost over 18% of its value in recent 24 hours to trade at $15.96 at the time of writing. This is the lowest level since the end of March. Notably, the sell-off happened against the growing trading volumes.

In a separate development, Binance announced the launch of Binance US trading. The US-based cryptocurrency exchange went live on Tuesday, September 24.

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