Binance Bitcoin Price Dips To $24,111 And Quickly Rebounds To $87,000

On December 25, bitcoin briefly dropped to 24,000 USD on Binance’s USD1 pair before quickly returning to more usual levels. Such an unexpected move raises questions about the stability of low liquidity pairs and risk management on trading platforms. In a rapidly evolving crypto market, this incident reveals challenges related to liquidity and regulation.

A sudden drop on Binance

An unexpected event shook Binance on December 25, where the bitcoin price briefly plunged to 24,111 USD on the BTC/USD1 pair, before quickly climbing back to levels near 87,000 USD.

This sudden drop, although spectacular, revealed specific issues related to the liquidity of trading pairs.

Here are the key points related to the incident :

• The flash movement occurred during the night from Wednesday to Thursday, stabilizing within seconds ;

• The flagship crypto’s price hit a low of 24,111 USD, a considerable gap from its usual level of over 87,000 USD ;

• This phenomenon affected only the BTC/USD1 pair, an asset linked to a relatively new stablecoin, launched by World Liberty Financial, supported by the Trump family ;

• According to Binance, the drop was due to low liquidity on this specific trading pair. The lack of active institutional investors left the order book too thin to absorb large volumes without causing extreme price movements ;

• This event was not observed on any other major BTC pair, suggesting the issue was localized to BTC/USD1 and not a general market degradation ;

• Within seconds, the price quickly climbed back above 87,000 USD once buy orders restored market balance.

This incident reveals the challenges posed by low liquidity trading pairs, especially when linked to stablecoins or new projects without sufficient market volume to manage significant fluctuations.

Volatility of low liquidity pairs

The volatility observed on the BTC/USD1 pair raises concerns about the risks associated with using less liquid trading pairs.

Indeed, the low order book depth on this pair can amplify price movements, creating spectacular fluctuations that do not necessarily reflect the overall market reality.

According to experts, these events are often due to a market microstructure problem, as indicated by the extreme fluctuations observed during off-peak hours when liquidity is particularly thin. This can lead to temporary price gaps more visible than what traders call “market anomalies”, but which do not signal a fundamental change in bitcoin itself.

The major risk lies in using stablecoins or new pairs still in development. These less popular pairs do not yet have sufficient liquidity to absorb large capital movements without causing slippage. Traders must therefore exercise extra caution, particularly during periods when the market is less active.

This incident signals the risks related to low liquidity pairs, highlighting the need to strengthen the stability of platforms. In this context, Binance has strengthened its ties with Trump via the USD1 stablecoin, an initiative that could play a key role in the future of crypto trading, while raising new questions about market regulation.