The US arm of global crypto exchange Binance is under fire from markets watchdogs left and right. Now, it appears to be struggling with keeping some of its biggest bitcoin (BTC) order books running smooth.
Binance.US displayed the price of bitcoin at more than $138,000 for its tether (USDT) market late Tuesday evening — almost 400% higher than spot prices shown elsewhere.
The sudden surge was only reported to have lasted for a few seconds, according to TradingView data reviewed by Blockworks.
Binance.US’s website shows 62.22 BTC changed hands during that time, equal to about $1.8 million at current prices.
The dramatic upwards spike suggests someone market bought that amount in bitcoin with USDT.
If that’s the case, poor liquidity meant all available sale orders were immediately filled at realistic prices. With only sky-high ‘joke bids’ waiting, the price of bitcoin shot to fresh all-time highs.
Blockworks has reached out to Binance.US for more information.
Situations like these are normally reflected in the opposite direction, with “flash crashes.” Such an event struck Binance.US in Oct. 2021, when the price of bitcoin collapsed 87% — from $65,000 to $8,200 — before quickly rebounding.
Binance.US blamed that situation on a buggy trading algorithm.
And in Dec. 2018, the price of ether tumbled from $100 to $13 on Coinbase Pro, only to return within minutes.
In any case, Binance.US has been dealing with poor liquidity for some time, amid struggles with its banking partners in light of its regulatory rumbles.
Last month, traders were paying premiums of more than 3% on bitcoin and similar amounts for ether (ETH) compared to rival platforms.
Analysts similarly suggested that liquidity problems were to blame for the price discrepancies. Those premiums have since closed.
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