While at work my phone had been BLOWING up with the events from Ethereum. If you hadn't learned, the value of Ethereum crashed to nearly $13 on the Coinbase and GDAX exchange site.
That skinny red candle going STRAIGHT down you see is the result of the crash in the system for Coinbase and GDAX leading to what we all know as panic and confusion. As my friends texted me I began researching what had caused the crash through various websites even while sitting in meetings at work. Here is my two cents on what had happened.
Yesterday June 20, 2017 the release of new ICO Status Token was available for trading. The hype was real on this token as thousands of platforms were talking about this new ICO. The hype behind this release had been built up so much from users who were unable to buy the BAT coin that they knew for sure they wanted to get their hands on Status. Through heavy traffic and laggy transactions, the Status Token ICO was a successful hit driving in a whopping $64 million. This heavy traffic however led to a back log and congestion of Ethereum transactions located within the blockchain itself.
This heavy congestion created a huge lag of orders in the system especially in popular exchange Coinbase and GDAX. Coinbase and GDAX probably drive the most traffic for Ethereum, Bitcoin, and Litecoin users due to it's simplicity and user friendly functions. NOW during the next morning when the servers had finally calmed down after going through transaction after transaction, this was when the lag had hit. The congestion was becoming a problem leading to transactions taking forever causing people to not only panic but attempt to sell their Ethereum. As sell orders for Ethereum did not process the previous day, the lag had gone through and instead processed on Coinbase/GDAX at approximately 12:30pm PST. The immense number of sell orders had officially gone through the system bringing the price into a downward nose dive to a mere $13. This value however was then brought back up due to the amount of buy orders and people rushing towards the dip.
This frenzy of chaos however brings a bad reputation for not only Coinbase and GDAX but to Ethereum as well.
What we should take from this one minute crypto crisis is the fact that cryptocurrency is growing and we need to do something to allow for increased traffic. The Coinbase and GDAX servers are not capable of handling the amount of traffic and popularity that has been driving Ethereum to the moon. Ethereum and the technology is amazing but it's crushing to see that people have negative feelings over it because the exchange site servers cannot handle the increased traffic. What Coinbase and GDAX should be doing is working on their servers and looking for ways to upgrade them in order to allow for increased trading volume throughout the day. Crypto is the future and when the entire population begins to use this future we must be prepared to withstand the incoming traffic.
Instead of panicking, lets use this mishap to learn from it, better our technology, and fix the problems at hand. This will allow for not only Ethereum to strive even more, but also other cryptocurrencies such as steem, litecoin, bitcoin, and various others.
Disclaimer: I am personally an Ethereum investor myself. This post is written through my opinion and my research! If you take any action with Ethereum or any cryptocurrency after reading this post please do research of your own to understand before making any actions! I am not a professional investor nor a financial consultant, just a cryptocurrency enthusiast. I also love any criticism, comments, thoughts, opinions, and conversation so please feel free to let me know down below.
I believe you were wrong. It was a single sell order that caused the crash.
I wrote a bit about it here:
https://steemit.com/ethereum/@ccampbell/my-theory-about-what-happened-on-coinbase-gdax-today
Some people suspect it came from this wallet:
https://etherscan.io/address/0x7d551397f79a2988b064afd0efebee802c7721bc
Yeah I've seen some posts about a whale accidently selling it for a wrong value. Also just talked to someone else about it too! I guess we really won't know until a couple days when it's all straightened out. So far there are so many different rumors and stories with facts and fake facts that it's hard to determine the one true reason.
Definitely going to read your post right now and leave my thoughts.
Do you think investing a large amount of money in Ethereum right now is a good idea or there is a risk in losing it all??!
Real fast reply I love it. I would suggest either investing at your own risk or holding off until the exchange servers fix themselves. There is still a lot of backlog as the server admins work out the issue and continue transactions to run smoothly.
As for the price and whether or not you should invest, I suggest you research the coin and see if you believe in the technology behind it. For myself (take this with a grain of salt) I believe in the technology but I am a long holder for this coin. In the short run it will have its ups and downs but in the long run I believe in the future of ethereum and the work of Vitalik Butertin.
As always, do not make investments based on my opinion as everyone has their own!
yes i agree with you i should research more before investing, as i am new to the cryptocurrency world i wanted to hear other people's opinions
thanks buddy
Of course. Everyone is new to cryptocurrency in my opinion because it has been developing still these last couple of years. If you can understand white papers try reading those as they give you a very detailed explanation of where the developers try to go with the technology.
yes i will do, thank you for your help i will be be following your posts
Of course, it's my pleasure. Thanks a lot!
Now is a good time to buy and long term eth will only go up. To much investment and backing has gone into eth for it to fail :) IMO
Haha hopefully we shoot for the moon!
I'm holding some and also put in a few orders :) to the moon <3
Now is a good time to buy and long term eth will only go up. To much investment and backing has gone into eth for it to fail :) IMO
It depends on your trading strategy. If you're going long, and want to put up a large amount I'd be sure to know just how stable it is from the government, and their want to make more or not. If you're going short you can just jump in and out without taking as much of a risk and still make money.
i want to invest for like a year or something
I wish I could tell you a definitive. Unfortunately there are too many ifs cause governments in different countries are trying to put sanctions on cryptocurrencies and we still don't know how many more coins are going to be produced. Not sure what your background is but if you can study the charts and keep ahead in the news you should be fine. There are also services that supply the news within the chart software you use.
Its funny you just posted this as I just wrote a piece about how the cryptocurrencies are actually moving too fast. Just 5 weeks ago there was almost a totally different listing of the top ten in comparison to today. I'm only speaking on altcoins.
Haha yeah crypto has been so volatile these last couple of weeks. I get texts every morning from my friends going in excitement or disappointment when the value keeps changing or reaching new aths. They just need to understand to let crypto adjust to the craziness and wait for the long run.
I'll be sure to check out your post and give you my thoughts about it as well!
That's too funny and you know those are the people who have most likely never traded before. Everyone is crossing their figures to cash out early like a lot of bitcoin people were able to do. I guess they forget bitcoin took years.
It did take years. I keep telling my panicking friends to hodl for the long run as ethereum news has only picked up in the last three months. It's hard trying to explain to them though because at the same time you don't want to be responsible for their money 🤔
i hope transaction ethereum back to normal, my eth still pending
May I ask just for curiousity what exchange you used for the eth transaction. Also the time you processed the transaction? Would be great to get some more information.
I have a little bitcoin so think I will take a punt on exchanging for Ethereum. Thanks for the post
Thanks for reading. Always good to diversify that portfolio! Just be aware of the slow transactions and backlog still going on in the exchanges. They should be working on it though.
I'm hoping that Ether dips to $200....I'd love to scoop up 50 Ether for that price
Hahah I was just talking about it with a friend when we would set our orders to purchase some more eth. $200 sounds like a solid number to me :) it's too bad we couldn't get in on that $13 dip though!
Right??!! lol. Honestly the only reason I have money to play with is because when Ether was at $10 a long time ago, I put like $500 into a genesis 2 year contract. I literally forgot about it until seeing btc going sky high and was blown away when I saw it. Sold most of it at 350-400 to get into other stuff like steem. It took me a while to remember where I stored my address and password..like 3 weeks....super annoying! lol
Hahahha storing crypto addresses and passwords are the worst but at least it helps keep it more secure! Wow nice call on the mining contract that early. I've been looking into cloud mining and they're so expensive now that the profits are pretty minimal :/ just means we have to explore other coins though!
Exactly! I'd love to get in on some monero mining. Either that or Gridcoin mining...I have a bunch of both, but I want MORE! lol
MOREMOREMORE! That's me everyday
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Hi @stephcurry! I am waiting for Etherium to chase more on Bitcoin. Hihi