GDAX Suspends ETH Trading After 'Flash Crash' to 10 Cents - Bitsonline

GDAX Suspends ETH Trading After ‘Flash Crash’ to 10 Cents

Exchange GDAX has disabled ETH-USD trading as it investigates a “flash crash” that happened on the Ethereum market. The issue saw ETH prices suddenly fall from $320 USD to $13.94 and even 10 cents.

Also read: Petition Asks Jeff Bezos, Amazon to Accept Bitcoin and Litecoin

[Update 21 June 2017 8:30PM EST]: GDAX has resumed trading on ETH-USD, though margin funding there is still disabled.

Screenshots from the order book show ETH-USD trades actually filled at $0.10 and $1.00, as well as several other ridiculously low prices.

https://twitter.com/AlezTory/status/877626891875659776

The crash happened between 3:30PM and 3:45PM (EST). Prices rebounded before GDAX suspended trading but only to around $300. Just a day earlier, the ETH price had been as high as $380 on the exchange.

GDAX ETH flash crash 1
source: GDAX

The price appeared to bounce back to around $300 and GDAX’s Trade History shows orders filled around that price before trading was suspended.

However an updated chart stops at the crash, with no further data. Other exchanges, like BTC-e, did not suspend trading but have temporarily disabled ETH withdrawals.

GDAX ETH flash crash 1
source: GDAX

GDAX posted a statement that read:

“Trading is disabled for ETH-USD while we investigate this issue. We are also investigating reports of sign in issues on GDAX.com.

“Investigating – We’re currently investigating sign in issues on GDAX.com, as well as the cause of rapid price movement on the ETH-USD order book. We have disabled further margin funding for the time being.”

The Coinbase-owned exchange has not revealed any more details about the issue. Bitsonline will continue to monitor the story.

Token Sales and ETH Network Congestion

On social media, some speculated whether the crash was due to a recent ICO “cashing out”:

However there is no evidence of this at present, and it would seem like a counter-productive move for any company trying to raise money.

The Ethereum network itself has experienced congestion in the past 12 hours due to token sales, namely Vinny Lingham’s Civic token and Status. Even one ICO often causes network delays, so two in a short period could be problematic.

Lingham noted the network congestion and suggested Status had caused the issue by moving its ICO ahead of his company’s:

Reddit user “emansipater” on Reddit’s Ethereum sub also blamed Status, calling the ICO “badly designed” with “a huge number of high gas fee transactions, most of which are failing but still filling up blocks and preventing normal tx’s from getting in”.

Lingham had previously warned buyers that Civic’s ICO could cause delays, and suggested interested parties use bitcoin instead.

Status itself has (so far) not commented publicly on the issue.

ICOs, a.k.a. “initial coin offerings” and “token sales” have been controversial lately. As well as questions about their economic model and legality, popular token sales have recently clogged the Ethereum network, delaying all transactions for hours.

It’s a problem Ethereum will need to address as soon as possible, as ICOs become more common and more lucrative.

Have you experienced any issues with ICOs or ETH today? Tell us about it here.


Images via Twitter, GDAX, Pixabay

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