The price of Bitcoin (BTC) dropped roughly 7% within an hour on April 26, plummeting from $29,850 to $27,789, allegedly due to a false alert sent out by blockchain analytics firm Arkham Intelligence regarding Bitcoin wallets linked to Mt. Gox and the U.S. government. Arkham initially confirmed the mistake occurred due to a “bug fix” which sent out an inaccurate alert on their analytics platform, affecting a “small subset of users.” The alert was then retweeted by the popular crypto news alert account DB or Tier10k.
[DB] Mt Gox and US Govt Wallets Making Transactions: Arkham Alert
— db (@tier10k) April 26, 2023
One hour later, Arkham tweeted that they had conducted an investigation and found that their alerts were accurate in this case. Arkham also highlighted that the drop occurred between 19:17 and 20:01 UTC and the alerts and tweet were sent afterward at 20:07 UTC and 20:08 UTC, concluding that neither caused the sharp BTC price drop that day.
Data published by Twitter user IT Tech showed no transfers from the wallets linked to Mt. Gox, indicating that Bitcoin’s flash crash could have occurred due to unknown reasons.
FAKE NEWS about MT Gox wallets making transactions.
No activity there✅ pic.twitter.com/mdOZv4nzI4
— IT Tech (@IT_Tech_PL) April 26, 2023
Although it remains unclear what triggered the flash crash, the sudden steep decline in prices affected the derivatives market, with the total sum of liquidations for crypto market participants exceeding $211 million, with Bitcoin traders accounting for nearly $97 million worth of liquidations.
At the time of writing, Bitcoin was trading at $28,378, up 0.25% in the last 24 hours, according to data from the Cointelegraph Price Index.
Cointelegraph contacted Arkham CEO Miguel Morel for clarification, but has yet to receive a response.
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