Bitcoin briefly traded above $150,000 on Bitfinex on September 20, nearly doubling in price before quickly falling back to its previous level.
The spike occurred in a BTC perpetual futures contract, according to TradingView data. Bitfinex has not yet explained what caused the move, so it remains unclear whether the spike was the result of a technical issue or a sudden lack of liquidity during a large trade.
One possible explanation is a liquidity squeeze. A sharp move higher can trigger the automatic liquidation of short positions. Traders whose positions are being liquidated have to buy BTC at market prices, potentially creating a wave of additional demand. If there isn't enough liquidity on the order book, those orders can temporarily push the price far above the broader market level.
Bitfinex is a centralized crypto exchange launched in 2012 and is affiliated with Tether, the company behind USDT. On CoinMarketCap, it ranks 12th by exchange volume, with around $570 million in daily spot trading volume.
Extreme price spikes have happened on other exchanges as well. In 2024, Bitcoin briefly fell below $9,000 on BitMEX while other exchanges held well above $63,000; BitMEX said the move was caused by large sell orders.
Binance.US saw something even more extreme in October 2021, when Bitcoin briefly crashed 87% on the platform, falling from around $65,000 to $8,200 before recovering almost immediately. The culprit this time wasn't a wave of sell orders but a bug in an institutional trader's algorithm.
The Bitfinex spike was much shorter, and the exchange has yet to provide an official explanation. For now, the $150,000 print appears to have been isolated to the exchange's perpetual futures market rather than a move in Bitcoin's broader market price.
