Bitcoin (BTC) price briefly surged to $56k on Bitfinex, well above levels elsewhere

The price of Bitcoin (BTC) in Bitfinex’s perpetual swaps market temporarily surpassed $56,000 on Tuesday — well above levels prevailing elsewhere and Bitfinex’s exchange rates before or immediately thereafter — amid a wave of volume amid the lack of liquidity.

Trading volume on Bitfinex’s BTC-PERP market rose to 322 BTC ($9.1 million) between 14:24 and 14:26 UTC, which is about a quarter of the daily volume of the trading pair.

Some traders’ positions were liquidated amid the rapid rally, according to data from Bitfinex trading platform.

The move came as bitcoin rose 2.5% in spot markets elsewhere as investors reacted to the share prices of two banks, Bacoist (PACW) and Western Alliance (WAL), falling more than 30% on concerns about banking. American. System resumed.

At press time, the BTC-PERP 10% pair has a market depth of 110 BTC, which means that a buy order for 110 BTC will move the price in that particular market by 10% — evidence that liquidity remains low at Bitfinex.

A Bitfinex spokesperson did not immediately respond to CoinDesk’s request for comment. Paolo Ardoino, Chief Technology Officer of Bitfinex, said: chirp: “Low liquidity at that moment in time. But the system worked as expected. The matching engine handled all orders correctly.”

Update (May 2, 2023, 14:40 UTC): Adds a tweet from the CTO at Bitfinex.

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