On Wednesday, amid a veritable collapse in crypto prices, one twentysomething in California explained his predicament to Bloomberg.
“Every time I log in, it’ll take a minute and after it does log in, it won’t load any of my information,” he said, lamenting that the platform he uses is “the only place I can buy Shiba and I missed my chance to get in on the dip.”
Although the exchange he referenced hadn’t reported any problems, others had, including Coinbase, which experienced what it called “intermittent downtime.”
“We’re seeing some issues on Coinbase and Coinbase Pro and we’re aware some features may not be functioning completely normal,” the company said, amid the melee. “We’re investigating what’s going on right now, and as soon as we know more we’ll let you know.”
The company later said customers had problems “logging in, seeing their balances, and trading.” (Other than that, though…)
Users (or those purporting to be users on social media) were furious. “Can’t sell or buy during a huge dump wtf #rigged,” one person tweeted. Another mocked the company, referencing Elon Musk’s influence over the market: “We’re seeing some issues… it appears Elon Musk has destroyed half your portfolio. We’re currently trying to find where he hid it and will restore your accounts as soon as everyone stops freaking out. Thank you for your patience.”
You get the idea. The vitriol was heavy, and it poured in from thousands upon thousands of users.
Eventually, the issues were resolved, but the shares dove some 6%.
Coinbase now trades well below the reference price set by Nasdaq for its direct listing (figure above).
It’s suffered a virtually uninterrupted string of declines since going public last month. The stock is on track for a fourth weekly decline in five weeks of public trading. It’s off nearly 50% from the intraday highs hit on IPO day.
But Wednesday’s losses for Coinbase paled in comparison to Bitcoin’s intraday plunge. At one point, the world’s non-asset par excellence dropped almost 30% (figure below), before trimming losses.
At the nadir, Bitcoin was down more than 50% from its all-time highs. Earlier in the day, it wiped away all the gains logged since Tesla announced the company added $1.5 billion of the coin to its balance sheet.
More than a half-trillion in “value” evaporated in just hours during the worst of the slump. The scare quotes around “value” are there for a reason.
Coinbase wasn’t the only platform to experience problems. Binance, the world’s largest exchange, temporarily disabled Ether withdrawals citing “network congestion.” The platform, which Bloomberg said last week is the subject of a joint probe by the IRS and the DOJ, “thanked” users for their “patience” and apologized “for any inconvenience.”
Again, social media wasn’t in a forgiving mood. “They’re restricting sales all over the world. Can’t deposit money in Ukraine either. WTF?!,” one user shrieked. “Every time there’s a big dip something goes wrong with the exchanges,” another netizen mused, while posting a laughing emoji.
For many, Wednesday was no laughing matter, though. One industry player called it a “welcome to crypto” day for new entrants.
Mike Novogratz was constructive — sort of. “Humpty Dumpty never gets put back together in two days when he cracks,” he told CNBC. “It’s going to take a while.”
But don’t worry, Bitcoin isn’t going anywhere. “The crypto revolution has happened,” Novogratz insisted. He called Wednesday a “setback” and conceded that “people lost a lot of money.” But, he imagined, “they’ll dust themselves off.”
That’s easy to say when you’re a billionaire.
By the end of a wild Wednesday, Bitcoin pared losses to just over 10%. Other tokens, though, weren’t so lucky.
Who could have predicted………?
Still not the apocalypse the anti crypto crowd wants. $30K btc =/= $0.
Look. It’s not complicated. Bitcoin is liquid/electronic gold. It takes off/works out (or not) through adoption. This is the only thing that matters. Adoption.
Now, I’ll be the first one to admit that Musk antics are detracting significantly from the “institutional adoption” narrative we had seen emerged a month ago. Certainly setting us back months maybe a year.
But that remains the play. Adoption or not. And it’s a pretty binary outcome. Either yes and BTC market cap will be huge (Gold is 11T but Gold is inconvenient so…) or no and the correct price for BTC is zero.
In the world of crypto and centralized exchanges stop and limit orders are your only friends on crash days…
And this is something people thinks will replace reserve currencies? What a con.
I think Millenials and Z’s are used to this sham treatment from all their brokers. Robinhood was down quite a bit earlier in the year, not to mention frequently last March. When my Kraken account wouldn’t load this morning, I was wasn’t really bothered because buying (or selling) when there is crypto blood in the streets — however tempting — is a uniformly bad idea. These exchanges are like the bartender that took the drunk’s keys.
When the stock market plummets Fidelity is just as bad. Last March there were periods when i could not access my portfolio. In the last 20 years there has been several times during high volatility that Fidelity servers became unresponsive.