Following yesterday’s spectacular flash crash which sent eth’s price down to 10 cent, ethereum traders have mobilized with bids for nearly 3 million eth at under $50, hoping to catch the next huge market sell.
They’re likely dreaming of instantly turning $350 into one million, as one eth trader did yesterday during the flash crash, scooping thousands of eth at just 10 cent each.
These flash crash events, however, have “only” happened once a month, starting in April when a GDAX glitch sent price to 6 cents, in May when a large sell order at Kraken sent it to $20, and yesterday when a large sell order sent it to 10 cent.
But such things are unpredictable, so eth traders are preparing just in case, hoping to strike lucky and get instantly rich thanks to either some fat finger or perhaps some drunk trader who thinks it’s a great idea to sell millions at market order.
A market order which then causes a cascade of stop losses and margin calls, sending price further and further down, assisted somewhat by panicked traders too, so giving us a spectacle.
Some lose their shirts in the process, with their funds being instantly obliterated as the order book is quickly vacuumed, while some others strike it rich, as the eth trader did yesterday.
However, flash crash events are somewhat rare, so locking up all that fiat in unlikely to be filled bids does not come without cost. There’s lost opportunity, and it’s being held by a third party, so there is counter-party risk too.
Eventually, therefore, the bids down there may thin considerably as everyone forgets and moves on, but right now eth traders are sitting at their desks, tapping their fingers, while praying for another flash crash so that they can buy all the cheap eth.
Best of luck guys. You’ll need it!
