There has been an uproar among the crypto community on account of the Coinbase Pro trading halt earlier today. Coinbase is one the world’s leading cryptocurrency exchange platforms. As such, the halt affected countless individuals and transactions. The halts have generated upset, concern, and skepticism.
Tweets from Coinbase
[status] Identified: The BTC-USD order book did not meet sufficient liquidity needed to enter limit-only mode. We have cleared the book and expect to re-open the book in post-only mode at 9:00am PT. https://t.co/EOfg1Mt7lM
— Coinbase Pro (@CoinbasePro) August 10, 2018
The halting affected BTC/USD trading services specifically, meanwhile Coinbase released periodical tweets with status updates regarding the investigations. Open borders being conducted in BTC/USD were cleared by Coinbase to address the problem. They then released an announcement stating that the platform would remain in cancel-only mode until the investigation was complete. They then ran into the problem of insufficient liquidity for the BTC/USD order book to enter limit-only mode, at which time they opted to remain in post-only mode.
As one may imagine, users ranged from concerned to irate, noting on social media and public forums that Coinbase should have procedures in place for occurrences such as these, some individuals even threatening to move to an alternative trading platform. Coinbase has countless active users at any given time, many of whom were mid-trade or conducting time-sensitive transactions when the halts occurred.
Decline in value
In addition to the upset surrounding the affected transactions, bitcoin owners were also left to fear for the value of their investments as instances such as these do not bode well for the bitcoin market. As predicted, bitcoin saw a significant decline in value today and the community is not happy.
In light of recent events with the extended decision deadline of the bitcoin ETF from the SEC, the community is skeptical about why these problems occurred and if they should fear such issues in the future. Cryptocurrency operates within a delicate ecosystem. seemingly small blips in the system have large impacts on the crypto community. Does this trading halt pose a long-term threat to bitcoin’s value and Coinbase’s credibility?