The bitcoin crash that occurred roughly 24 hours ago has caused Coinbase – a popular cryptocurrency exchange – to experience a brief period of inactivity before finally restoring its services later in the day.
Coinbase Crashes for the Second Time in Weeks
This marks the second time the trading platform has crashed in the last two weeks. The first occurred when bitcoin first rose into the high $9,000 range and gained virtually $1,000 overnight. At that time, the exchange was experiencing such high trading levels that the network came crashing down. Coinbase was able to restore itself, but the fact that it’s now happened twice the minute bitcoin does anything drastic isn’t a good sign.
Given that Coinbase is one of the largest and most prominent bitcoin and crypto exchanges across the globe, many analysts are mocking the company for not taking stronger precautions against heavy bitcoin volatility to keep its systems online. Rachel Siegel – a bitcoin and crypto content creator – issued a message on Twitter that was critical of the platform. She wrote:
How many times do we have to say it? Take your bitcoin off Coinbase if you want to have access to it. This is not the first time Coinbase has gone down and it surely will not be the last.
Additional mockery came from Jason Williams, a co-founder and partner at bitcoin and crypto hedge fund Morgan Creek Digital. He explained in a recent interview:
Coinbase is acting like the NYSE circuit breaking.
The shutdown was acknowledged by the trading platform soon after it occurred. Executives released a statement explaining that they were “investigating the issue.” The shutdown continued for approximately three hours until the technical support team was able to bring the exchange back online.
To be fair, Coinbase has never been down for long. While situations like these have happened in the past, Coinbase is always quick to react and restore itself, but the fact that it’s now happening so often raises many concerns amongst those heavily involved in the crypto space.
Data from Skew, for example, suggests that during the previous shutdown – which occurred in early May – Coinbase was not experiencing maximum trading, nor were present trading levels as strong as they had been during the past two weeks.
This Is Occurring Too Often
With that in mind, many are probably wondering what kind of weak systems Coinbase happens to be employing. Prior to this event, Coinbase also went down two months prior in March.
On a day that is now widely referred to as Black Thursday, the coronavirus pandemic saw more than 20 percent of bitcoin’s overall value disappear overnight as the currency fell into the high $3,000 range. Coinbase remained inactive for much of the day and kept many users locked out of their accounts as the team worked to resolve its network.