Popular cryptocurrency analytics platform CoinMarketCap appeared to be suffering from a technical issue earlier today that was artificially inflating the aggregate price of Bitcoin by as much as $1000 and prices on individual exchanges by tens of thousands of dollars in some instances.
Strange Things are Afoot at CoinMarketCap
Last month brought welcome relief to Bitcoin investors as steadily increasing prices seemed to indicate that the bear market conditions plaguing the cryptocurrency were beginning to wane. The relief was shortlived, however, as prices began to slip during the last few days of July before taking a marked tumble – from $8183.32 on July 30 to $7504.95 on August 1.
Earlier today, the average price of Bitcoin was hovering between $7400 and $7500 – except on CoinMarketCap where the average price was nearly $1000 higher.
Looking at the individual markets, it gets even weirder as dozens of exchanges appeared to be reporting Bitcoin prices of more than $73k. Yes, you read that right. As you can see from the screenshots below, Binance, Bittrex, Poloniex, BitForex, CoinBene, CoinEx, BigONE, and many others were all reporting prices of between $73,000 and $73,200.
A quick check of prices on the actual exchanges themselves, however, revealed prices much more in line with the market average reported on CryptoCompare, LiveCoinWatch, BitInfoCharts, and others. The glitch appears to have affected predominantly BTC/USDT but other BTC trading pairs were also affected.
So what gives?
The platform recently rolled out some new features – including the release of a professional (read: paid) API, the addition of derivatives markets, updates to their iOS app, and more – so it is possible that the glitch is related.
CoinMarketCap has yet to provide any details other than to say that they are aware of the issue and are working on it.
We are currently aware of an issue with the data we are pulling in. We are investigating this matter and we will follow up with more information shortly.
— CoinMarketCap (@CoinMarketCap) August 3, 2018
Response within the crypto community has been swift, of course, with reactions ranging from confused to downright snarky.
Gg @CoinMarketCap nice new paid api.
Works perfect I see. pic.twitter.com/LMhfUtbbwl— Romano (@RNR_0) August 3, 2018
Not CoinMarketCap’s First Offense
This certainly isn’t the first time CoinMarketCap has had problems. Back in January of this year, they arbitrarily decided to exclude data from South Korean exchanges. This in and of itself wouldn’t have been a problem, but they neglected to give anyone a head’s up. As a result, prices reported on the platform plummeted and sparked a panic-induced selloff.
Of course, Zcoin investors will no doubt remember how CoinMarketCap erroneously including Zcash listings as Zcoin causing XZC prices to skyrocket from less than $30 to more than $100 in just minutes. As a result, several exchanges reported massive Zcoin price pumps – which was great if you were an early adopter of XZC but it sucked for anyone buying into the pump.
UPDATE August 3, 2018, 2:29 pm EST: CoinMarketCap has said that the cause of the glitch was a price calculation error with regard to Tether. The error resulted in any listing with a Tether market to become artificially inflated. The issue appears to have resolved itself and CoinMarketCap will release more details following a “post mortem.”
What do you think of CoinMarketCap’s latest snafu? Can you think of any other instances where their errors caused problems for traders? Let us know in the comments below.
Images courtesy of CoinMarketCap, Twitter