The cryptocurrency market witnessed a bitcoin price slump in the early hours of May 17, 2019. Speculations, however, point to a 5,100 BTC dump that occurred on the Bitstamp exchange as the likely reason for the price plunge.
Profit Scraping or Market Manipulation?
A huge dump on the Bitstamp exchange saw the price of bitcoin tank by more than 20 percent which immediately saw the BTC price fall on other exchanges to hit a bottom of $7,100 across the board.
The BTC price plunge caused altcoins to plummet as well, with most of the top-100 tokens seeing much of their recent price gains wiped away as a result.
Analysts however attribute the price slump to a number of factors, Jehan Chu of Kinetic Capital stated that the flip could be a result of profit-taking. In Chu’s words:
“This last drop was likely caused by a combination of profit-taking and also algorithmic trading compounding the swift fall. We can expect these types of steep rises and drops to continue for some time until institutional investors grow market volume”.
However, some bitcoin analysts observed that the bitcoin price flash crash was likely caused by a 5,100 BTC dump that occurred on Bitstamp. Dovey Wan, the co-founder of Primitive, took to Twitter to state that BTC dump on the exchange was deliberate and had strong signs of manipulation.
In a thread, one of Wan’s tweet reads:
“As NO ONE will simply keep 5000 BTC on exchange, this is deliberately planned dump scheme, aka manipulation imo. That dumper can on one hand dumping on stamp with poor liquidity > move the Bmx contract > 100x short on Bmx to take huge advantage in stacking cheap BTC”.
Price Retracement Warnings Come True
Bitcoin has since rebounded from the price flash crash, as it is currency trading at $7,300. But it seems like bitcoin’s parabola days have been ground to a halt and predictions of a price retrace seem evident. However, the price slump is unlikely to affect bitcoin’s bull run.
Several analysts have warned investors about bitcoin’s volatility and an imminent BTC price crash. As reported by BTCManager, CNBC analysts Anthony Grisanti and Bob Iaccino predicted that a price pullback, with Grisanti placing the range between $6,870 and $6,425.
Another cryptocurrency analyst, @CryptoFibonacci, earlier predicted a price retracement for bitcoin.