Just before 6am ET, cryptocurrencies suddenly flash crashed, tumbling on no news with some plunging as much as 12%, after a largely unchanged overnight session.
Bitcoin, the world’s biggest digital asset, erased gains and fell more than 3% in about minutes, tumbling back under $7000 after trading in the mid-$7300 range earlier. Litecoin, Ethereum and Ripple followed, with Ethereum crashing by as much as 12%, while litecoin and ripple sank over 8%. There was no catalyst or news behind the selloff, although as Bloomberg’s Andrew Cinko notes, “perhaps its just part of the risk-off mentality gripping all markets amid the latest round of weakness in emerging markets.”
The selloff appears to have stabilized, but so far there is little buying impetus as traders scramble to find what the cause of the selling was.