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In the highly volatile cryptocurrency market, the price of Shiba Inu (SHIB) drew attention with a sharp decline on the US-based cryptocurrency exchange Coinbase. This incident has been recorded as a significant example of the ongoing liquidity and market depth issues in the cryptocurrency market.
Price Drops 50% on Coinbase Exchange
The price of SHIB experienced a temporary 50% drop on the Coinbase exchange today in the early hours, a move considered unusual in cryptocurrency trading, before quickly recovering. The drop from $0.000044 to $0.000022 on Coinbase occurred amidst a broader sell-off wave affecting major cryptocurrencies like Bitcoin (BTC) and other leading altcoins.
As in the case with SHIB on Coinbase, such sharp price movements typically occur when a sell order exceeds the available liquidity at a particular cryptocurrency exchange. Despite the sharp drop, the market depth of SHIB on Coinbase was at $1.2 million in the morning, indicating significant trading activity on the cryptocurrency exchange.
Furthermore, the spot SHIB volume on Coinbase in the last 24 hours exceeded $1.7 billion, indicating a very high level of activity.
Quick Recovery
Although the morning’s sell-off caused temporary turbulence, SHIB’s price managed to recover quickly, trading with a 45% increase over the last 24 hours. According to data from the crypto data and price platform CoinGecko, the rise in the altcoin’s price reflects the increased activity in the memecoin sector, which saw over 100% growth last week.
While the exact reason behind SHIB’s sudden and sharp drop on Coinbase remains unclear, it reflects the unpredictable nature of cryptocurrency trading and the problems that liquidity dynamics can cause. Nevertheless, this incident underscores the importance of monitoring market depth and understanding the factors that influence price movements in the cryptocurrency market.
