An increase in cryptocurrency transactions coincided with a major disruption of bitcoin exchange and led to the reduction on other platforms, reflecting the difficulties that traditional brokers have had with a frenzy of stock market activity.
Coinbase Global Inc. digital currency exchange site said it is investigating an outage on Friday that prevented customers from trading on its web and mobile applications. Another stock exchange, Bittrex Global GmbH, said an increase in traffic had created technical problems on its platform.
Coinbase later said the trading was back and monitoring for other issues. A Coinbase spokesman said a sharp rise in transactions had caused technical problems that disrupted trading. Bittrex declined to comment.
Bitcoin rallied 4.8% on Friday, with a bitcoin worth $ 34,436. The most popular cryptocurrency has risen sharply in the last year, gaining converts from investors worried that central banks and governments, in their efforts to counter the economic effects of the coronavirus, risk devaluing fiat currencies.
Robinhood Markets Inc., which is under fire for suspending the trading of popular shares, has also limited activity on its cryptocurrency platform. Robinhood said it has temporarily disabled instant deposits for cryptocurrency purchases, citing extraordinary market conditions, according to its website.
A Robinhood spokeswoman said customers can still use funds that have already been received by Robinhood from their bank accounts to buy cryptocurrencies.
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The interruption of Coinbase comes at a delicate time. The company said this week that it intends to go public through a direct list of shares. Coinbase was launched in 2012 and is the largest cryptocurrency exchange in the US The San Francisco-based company was recently valued at about $ 8 billion and has more users than Charles Schwab Body
platform.
Wall Street has struggled to cope with growth in financial markets this week. Several retail brokerages dealt with interruptions, and high-speed traders reported trading errors.
For cryptocurrency exchanges, interruptions are nothing new. Platforms tend to be easily regulated, dominated by retail investors and prone to failures as business grows.
Increased cryptocurrency activity came on Friday as popular online brokerages restricted trading in highly traded stocks, including GameStop Body.
and AMC Entertainment Holdings Inc.
on Thursday. They were reacting to huge trading volumes stimulated by investors gathering on online platforms, such as Reddit’s WallStreetBets forum.
Some proponents of digital currency believe that investors unable to trade their preferred shares have instead moved to cryptography.
“What happened this week with GameStop and other highly volatile impulse-traded stocks – these platforms that restrict trading – led people to trade other assets,” said Meltem Demirors, strategy director at asset management firm CoinShares. from London. “Avoid many of the problems we have seen in the old financial markets and thus have seen the change of retail investors.”
One of the cryptocurrencies traded on Friday was Dogecoin, which was created in 2013 to amuse the growing cryptocurrency industry. It was named after a popular internet meme about a dog that could not write.
Dogecoin rose 250% to 11:30 AM ET on Friday, according to CoinDesk. By 16:45 it had slipped back to increase by 125%.
Dogecoin presents an image of the doge meme mascot, a Shiba Inu dog that has been digitally modified to appear on everything from astronauts to Twinkies. Dogecoin has also become a popular topic on RedSit’s WallStreetBets and SatoshiStreetBets due to its cheap cost relative to bitcoin.
Arousing sudden interest in the currency, Tesla CEO Elon Musk wrote on Twitter a fake cover of the magazine that read “DOGUE” on Thursday. After its growth, a Dogecoin was worth $ 0.05 on Friday. All Dogecoins in circulation are currently worth $ 7 billion, according to CoinDesk.
Mr Musk also updated his biography page on Twitter to say “#bitcoin”. This came after Bridgewater Associates founder Ray Dalio called Bitcoin “a hell of an invention” in a letter published on Thursday.
Write to Caitlin Ostroff to [email protected]
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