On May 14, a large number of LTC / PAX trading pairings on Binance led Litecoin's price to $ 100,000.
Recently, a new price was added to the sudden price movements, which are common in crypto money exchanges.
On May 14, the price of Litecoin jumped to $ 100,000 at 05.50 in the Binance.
The event took place in the pair of LTC / PAX trading with little market depth. A large limitless market order issued by an unlucky or novice user has caused the price to suddenly rise to $ 100,000. The amount of LTC taken from $ 100,000 is unknown. In addition, 2847 LTCs have been purchased until the price reaches $ 100,000.
How does this happen?
Market orders (market order) transactions made in the sales orders, the amount requested to be cleaned up to be completed. For example, if you want to buy 1000 LTC at the current market price, the order will automatically match the next sales order if the minimum limit order order does not meet the purchase order, and this will continue to move up until the requested amount is completed. This situation, called slipage, causes the price to be over-priced.
Prevention of Binance
On the other hand, the crypto money exchange Binance has set a limit of 500 percent for buying and selling orders as a precaution against such sudden price movements. In other words, 500 percent or less of the current price cannot be placed on a purchase or sales order.
The higher-priced orders entered before the stock market was taken and still remains valid.