On October 7, Bitget exchange witnessed an unexpected plunge in the value of its native token, BGB, sparking discussions among traders.

The Crash: A Sudden 50% Plunge

At around 02:58 UTC, BGB experienced a sharp drop, falling from $1.14 to $0.56 in less than five minutes, taking traders by surprise. The token remained volatile for nearly ten minutes before stabilizing at $1.04. Despite a partial recovery, the incident raised concerns about the cause of this decline.

Bitget’s Response: Promising Compensation

In an official statement, Bitget confirmed its awareness of the price fluctuation and announced plans to fully compensate users for any losses during the event. The company committed to delivering a detailed compensation plan within 24 hours and completing the process within 72 hours.

CITE_NA: 'BGB experienced unexpected volatility today due to market conditions, but the price has quickly stabilized. Bitget will fully compensate any asset losses.'

Possible Causes of the Crash

The exact cause of BGB’s sharp decline remains unclear. Potential factors include low liquidity during off-peak trading hours, market manipulation, or technical glitches. Reports of sluggish market conditions due to Asian holidays may have affected overall liquidity and trading volume. However, until Bitget releases its findings, the exact trigger remains speculative. Ryan Lee, Chief Analyst at Bitget, pointed out that price fluctuations are not uncommon in the crypto market and reminded that BGB previously reached an all-time high of $1.48 in June.

The incident with BGB raises important questions about the stability of cryptocurrency markets and underscores the need for stricter risk management and liquidation mechanisms. Bitget is committed to improving user experience and investigating the causes of sudden market shifts.