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Bitcoin flashed crashed on the BTC-E platform, falling close to 30 percent before recovering completely. The crash happened on a large sell order for several thousand coins. It’s unclear why the owner decided to dump the entire lot on the open market. The usual rumors are abound, ranging from a bug to a hacked account or a fat finger mistake. The exchange hasn’t published any news about the event so I assume they’re treating it as legitimate trading.
The crash started at 13:45 server time (6:45 EST) and by 13:46 prices had traded to a low of $194.92. The recovery was equally as vicious with BTC/USD back to $260 dollars per coin by 13:48. Other exchanges didn’t participate in the event and stayed stable during the entire ordeal. Bitcoin traded flat for the rest of the day on BTC-E and is currently quoted at $267.60 dollars.
The crash may be a result of weak liquidity during the summer dull-drums. The last time a flash-crash of this magnitude happened on BTC-E was also in the summer last year.