The price of Bitcoin on Bitfinex's perpetual swap market briefly surged above $56,000 earlier today, sending shockwaves across the crypto market.
Trading volume on Bitfinex's BTC-PERP market rose to 322 BTC ($9.1 million) for two minutes, accounting for approximately 25% of the daily volume on the trading pair.
In response to the sudden price spike, Bitfinex CTO Paolo Ardoino explained that low liquidity at that moment in time was the cause.
He also assured market participants that the system worked as expected and the matching engine handled all orders correctly.
Perpetual swaps, such as the BTC-PERP market on Bitfinex, are a type of derivative contract that allows traders to speculate on the future price of an asset like Bitcoin without an expiration date.
Alex DovbnyaMeanwhile, Bitcoin's overall market price has spiked as well, reaching an intraday high of $28,764 earlier today on the Bitstamp exchange.
The recent drop in shares of embattled U.S. regional banks appears to have contributed to Bitcoin's recovery.
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Valeria Blokhina
Vladislav Sopov
Dan Burgin