$10 Billion Bitcoin Flash Crash Hits Binance BTC/USD1 Pair
- BTC/USD1 plunged to ~$24K due to thin liquidity; the impact remained isolated to that pair.
- A large order and a drop in holiday volume triggered liquidations and a rapid rebound.
- A shallow USD1 depth indicated execution risk for new pairs under low-volume conditions.
Bitcoin briefly fell to around $24,000 on Binance’s BTC/USD1 pair on December 25, during thin holiday trading. A large sell order hit a shallow order book, pushing prices sharply lower within seconds. The move stayed isolated to the BTC/USD1 pair and did not affect Bitcoin prices on major markets.
What Happened on Binance’s BTC/USD1 Pair
Binance data showed Bitcoin trading at $87,000 before the sudden plunge on Binance’s BTC/USD1 spot pair. The drop appeared within seconds and remained confined to that single order book. Notably, no similar movement appeared on BTC/USDT or other major Bitcoin pairs.
As per analysts, a very large short position opened immediately before the drop. Wimar claimed a $1.8 billion short entered the market during thin liquidity hours. Shortly after, Bitcoin selling swept through the BTC/USD1 bids.
As a result, the order book printed extreme prices near $24,000. Long liquidations then led to additional forced selling inside the same pair. Total liquidations tied to the event reportedly exceeded $7 billion, although profit figures remain unknown.
However, the broader Bitcoin market did not reflect this move. Prices on other exchanges and Binance’s major pairs remained stable. The event, therefore, represented a localized flash crash, not a market-wide repricing of Bitcoin.
Why the Flash Crash Stayed Isolated
The BTC/USD1 pair relies on USD1, which is a newer stablecoin launched in 2025. USD1 has lower trading depth compared with established stablecoins like USDT. Consequently, fewer resting bids existed near the prevailing Bitcoin price.
During the Christmas holiday, trading volumes dropped sharply across many markets. Fewer market makers actively quoted prices, which widened spreads. Under these conditions, even one large market order can sweep multiple price levels.
Market structure amplified the move. Once initial selling pushed prices lower, automated liquidation systems reacted. These systems sold Bitcoin into the same shallow order book, extending the downward wick.
Importantly, BTC/USD1 does not anchor global Bitcoin pricing. Benchmark prices rely on aggregated data from deeper markets. As a result, the extreme print did not influence reference rates or broader trading activity.
Within seconds, new bids entered the book. Bitcoin prices on BTC/USD1 quickly rebounded toward $87,000. This rapid normalization indicated a temporary liquidity gap rather than sustained selling pressure.
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Comparisons, Claims, and Market Concerns
Analysts quickly compared the incident with earlier Binance flash events. According to Wimar.X, a similar wick occurred on the WBETH/USDT pair in October. That episode also featured sharp price drops followed by fast recoveries.
Joao Wedson, founder of Alphractal, explained that such events appear more often during weak market phases. Capital inflows decline, and liquidity thins across secondary pairs. As a result, sharp but brief price dislocations become more likely.
Some commentators labeled the move a “$10 billion crime,” citing liquidations and aggressive positioning. However, no exchange statement or regulatory finding has confirmed manipulation. Binance has not publicly attributed the incident to coordinated wrongdoing.
Questions also emerged around market makers, including Wintermute. At present, no verified data links any specific firm to the trades that caused the BTC/USD1 wick. On-chain movements alone have not established causation.
Notably, the event differed sharply from the October 10, 2025, market crash. That earlier episode involved systemwide liquidations across many assets and venues. By contrast, the Christmas event affected only one spot pair for seconds.
The BTC/USD1 flash crash, therefore, highlighted execution risks on thin pairs. New trading pairs and stablecoins can sometimes show odd price spikes when trading is quiet. Traders usually see these sudden moves as technical quirks, not real market signals.
Meanwhile, Bitcoin briefly hit $24,000 on Binance’s BTC/USD1 pair because there wasn’t much liquidity, and a few aggressive trades went through. This caused liquidations on that specific pair but didn’t affect Bitcoin’s price elsewhere. The incident highlighted the risks of thin liquidity in newly launched markets during low-volume hours.
