TL; DR Breakdown
- Bitcoin recently experienced a flash crash that took it from the $60k to the $50k range.
- Analyst Willy Woo thinks a power outage in China could be the cause.
- Some people don’t agree with this assessment.
Late last week, Bitcoin experienced a rather shocking flash-crash that saw the top coin plummet back to the $50k price range. On Sunday, the 18th of April, BTC went down from $61,400 to $54,200 before mounting a recovery to $57,600 and then dropping to $53,900. Since then, the crypto has been struggling to stay above the $55k range. At the moment, the price stands at around $56,500.
Now, one popular analyst thinks that the sudden price crash may have been caused by a power outage that occurred at a large mining installation in China.
Bitcoin hash rate dropped
According to the analyst, Willy Woo, the outage took the mining hub offline, resulting to a sudden drop in BTC hash rate. The said mining hub in Xinjiang is said to contribute roughly 25% of the hash rate in the Bitcoin network. At the time of the flash crash, the global hash rate had dropped from 172 million TH/s to 154 TH/s.
Willy also noted the whale activity occurring before the crash. Apparently, about 9,000 BTC was moved to Binance Exchange 2 days before the crash, something that Willy suggests might have been done by a Bitcoin whale with information about what was about to happen.
Also, whales have started accumulating during the dip. Willy noted that most of these whales have been long-term holders who rarely buy more. In Willy’s opinion, this development might have cause to validate Bitcoin as an asset capable of hitting $1 million in value at some point in the future.
Still, not everyone seems to agree with Willy Woo. Adam Cochran, who is a partner at Cinneanhaim Ventures, doesn’t agree. Adam sent out Twitter thread airing out his opinion.