Bitcoin Surges 12% to $64,000, Triggering Coinbase Incident

Bitcoin experienced significant volatility yesterday, surging by 12% to over $64,000 momentarily, only to decline to $59,000 an hour later. Currently, Bitcoin has rebounded and is trading above the $62,000 mark.

The approval of the Bitcoin ETF marks a pivotal moment for the cryptocurrency sector. On February 29, the total market capitalization of the cryptocurrency industry surged by a staggering $450 billion, reaching a three-year high of $2.25 trillion.

According to Bloomberg data, as of the market close on Wednesday, ETF funds reached a volume of $7.6 billion, surpassing previous records. BlackRock’s Bitcoin ETF invested approximately $3.3 billion, breaking records hours before the market closure, with IBIT reaching a volume of $2.2 billion.

Fidelity’s ETF fund reached a value of about $1.4 billion, while Grayscale’s ETF under the GBTC code achieved a volume of $1.8 billion. Bloomberg analyst James Seyffart noted that the previous record was $4.6 billion on the launch day.

Eric Balchunas, a senior analyst at Bloomberg, emphasized, “This is officially a frenzy,” highlighting that IBIT “today traded more than the first two weeks combined.” The ETFs, approved for trading since January, experienced high daily trading volumes this week, surpassing records on both Monday and Tuesday, reaching $1.3 billion in a single day.

The majority of the trading volume resulted from organic demand, indicating non-algorithmic origins. Platforms are seriously considering early additions to meet this demand, with Morgan Stanley currently reviewing the addition of ETF funds to its brokerage platform.

As Bitcoin surpassed the $60,000 mark for the first time since November 2021, Coinbase users were alarmed to find their wallets displaying a $0 balance. Promptly addressing the issue, the exchange swiftly halted its services, issuing a statement acknowledging the disruption:

https://t.co/QYlmwBBgQg

— Brian Armstrong (@brian_armstrong) February 28, 2024

Coinbase stated, “We are aware that some users may see a $0 balance on their Coinbase accounts and may experience errors when buying or selling. Our team is investigating this issue and will provide updates soon. Your assets remain secure.”

Coinbase’s CEO, Brian Armstrong, further explained that the exchange was grappling with a sudden surge in traffic and assured its 72 million users that the team was working diligently to resolve the situation.

Currently, the exchange notes that they have observed some improvements in customer transactions on the platform. However, some users may still encounter issues due to the continued high volume of traffic. Coinbase has advised users to monitor its website status for further updates.