A number of altcoins and memecoins saw a sharp crash today, with some tokens losing more than 50% of their value in minutes.
Causes of Altcoin Crash
One of the largest dips was from The AI Prophecy (ACT), which plummeted 58% from $0.19 to $0.08 within about one hour, wiping away almost $96 million market value according to CoinMarketCap. Other affected tokens include DeXe (DEXE), dForce (DF), sudeng (HIPPO), CZ’s Dog (BROCCOLI), and Kishu Inu (KISHU). Despite this, the overall market has not reacted, with Bitcoin remaining steady.
Response from Teams and the Crypto Community
The team behind Act I The AI Prophecy acknowledged the crash and alerted investors that they were investigating. 'Our team is actively investigating and working collaboratively with all relevant parties to address this matter,' they tweeted on X (formerly Twitter).
Speculations and Potential Market Implications
Some traders believe the recent Binance margin update was the cause. The exchange updated its leverage and margin settings for some tokens, prompting a massive liquidation reported by Lookonchain. Speculation also arose around Wintermute, though its CEO denied any involvement. This turmoil spread to other exchanges, affecting prices of various tokens.
The altcoin price crash has drawn attention from market participants and raises questions about the resilience of trading mechanisms and risk management strategies. Investors and traders may need to consider new factors in their strategy development.
