Crypto Market Recovers $ 170 Billion In 2 Hours Despite Flash Crash

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After sustaining a vigorous recovery in recent weeks, the cryptocurrency market momentarily experienced a lightning crash on Tuesday.

The general market recorded significant losses which affected almost all cryptocurrencies. According to data provided by CoinMarketCap, in two hours, the market wiped out about $ 330 billion, with the overall cap collapsing to $ 1.95 trillion in two hours.

However, the market recovered around $ 170 billion to $ 2.12 trillion. The plunge was initiated by Bitcoin, which went from around $ 52,000 to nearly $ 44,000.

24 hour crypto market capitalization chart. CoinMarketCap data.

The crash comes as the cryptocurrency market hit a historic moment with the official deployment of Bitcoin as legal tender in El Salvador.

Typically, the correction followed a week of steady gains with a 15% increase in overall market cap between August 30 and September 6.

Part of the market partly attributed the crash to an alleged rapid change in market sentiment regarding the speculated purchase of Bitcoin before El Salvador’s decision. Notably, the price of Bitcoin has continued to climb in recent days in anticipation of the action.

El Salvador buys additional Bitcoin

Additionally, in the midst of the crash, Salvadoran President Nayib Bukele revealed that the country took advantage of the drop in prices to purchase an additional 150 Bitcoins. Some market participants attributed the whale activity to the crash.

However, several crypto thought leaders are of the opinion that Bitcoin is still on the go despite the flash crash.

“I’m still trying to figure out that WTF actually happened. Mass liquidations at all levels. It reminds me of the historic crash of March ’20. Think twice before opening the leveraged trade next time. But Bitcoin is still in the bull market as long as it stays above $ 43K, so we can bounce back, ”said Hitesh Malviya, founder of itsblockchain.com, a blockchain and cryptocurrency publishing platform.

At the time of publication, the asset was trading at $ 46,800, which has plunged 10% in the past 24 hours.

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