Bitcoin’s Trading Pair Flashes Down to $24,000 on Binance: Why You Need to be Careful
The BTC/USD1 buying and selling pair on Binance skilled a quick flash crash. Bitcoin plunged to $24,000 earlier than shortly recovering.
The incident didn’t have an effect on Bitcoin costs on main pairs comparable to BTC/USDT. However, it highlighted liquidity dangers in newly launched buying and selling pairs.
BTC/USD1 crash to $24,000 exposes low-liquidity dangers
According to market knowledge from Binance, the incident lasted only some seconds. The BTC/USD1 worth later stabilized above $87,000.
USD1 is a brand new stablecoin issued by World Liberty Financial. The undertaking receives backing from the household of US President Donald Trump.
Charts from Binance confirmed a steep wick. The transfer didn’t set off any liquidation injury.
The incident occurred through the Christmas vacation interval. Trading volumes dropped sharply at the moment. Some observers speculated that the transfer was a liquidity take a look at for the BTC/USD1 pair.
Joao Wedson, founding father of Alphractal, defined that this phenomenon seems extra typically in bear markets. Capital inflows have a tendency to weaken throughout these phases.
“Low liquidity in some buying and selling pairs throughout a number of exchanges has been inflicting sharp volatility. It leads to momentary worth dislocations and arbitrage points for a couple of minutes. This is extra widespread than it appears when the market is in a bearish section,” Joao Wedson explained.
Another, extra detailed rationalization from the investor group linked the incident to Binance’s promotional campaign for USD1. Binance just lately launched a 20% APY promotion for up to $50,000 in USD1 per consumer.
WuBlockchain, a good market-watching account, reported a pointy surge in USD1 provide after the launch. Supply elevated by greater than 45.6 million tokens inside a couple of hours. Total market capitalization rose above $2.79 billion.
The sudden influx of capital into USD1 pushed the stablecoin’s worth up by 0.2%.
The X account Punk explained that many buyers attempted arbitrage. They borrowed USD1 and steadily bought it on the spot market to individuals becoming a member of the promotion.
Meanwhile, some merchants selected to promote by means of the BTC/USD1 pair. Thin liquidity caught them off guard. Prices collapsed sharply, inflicting the end result described above.
“This is only a small fluctuation within the bear market. There isn’t any want to fear. Many related fluctuations will seem later,” investor Punk said.
Could an identical state of affairs occur to BTC/USDT?
A broader query now attracts consideration. Could an identical occasion happen on the BTC/USDT pair? This pair holds the best liquidity out there. A sudden drop there would trigger large liquidation losses.
Analyst Maartunn cited Kaiko knowledge. He famous that Bitcoin’s 1% market depth has elevated considerably through the years.
“Depth didn’t simply get better. It expanded. By the October 2025 highs, Binance 1% depth exceeded $600 million. That degree stands above pre-2022 crash ranges,” Maartunn said.
He additionally emphasized that the decline in BTC/USDT costs didn’t erode liquidity. Over the course of greater than 100 days, the BTC/USDT pair fell 21.77% (from $110,291 to $86,089). During that interval, common each day spot quantity reached $19.8 billion, totaling $613.5 billion.
With deeper market depth and ample quantity, an identical occasion on BTC/USDT stays unlikely.
However, the incident serves as a lesson for merchants. Careful number of buying and selling pairs is important. Low-liquidity pairs could cause extreme slippage and surprising losses.
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