While the broader crypto market was tear higher Wednesday, bitcoin briefly plunged 30% to below $48,000 on decentralized perpetual exchange Lighter in a violent move that lasted seconds.
The flash crash contrasted sharply with price action elsewhere. During the same session, bitcoin rose from below $64,000 to above $69,000, marking one of its strongest intraday rallies in weeks.
This extreme move appears to have been limited to Lighter, where low liquidity amplified what would otherwise have been a routine transaction. In shallow order books, even modest selling pressure can trigger exaggerated price swings, producing so-called flash crashes that do not reflect the broader market.
This is probably what happened on Lighter. A single order to sell about 1,000 bitcoins — worth about $67 million at the time — wiped out available deals and briefly sent prices skyrocketing, according to a report. Discord Message by Web3 developer pseudonym 0xTimberJ.
“As Lighter is a newer DEX with less liquidity than centralized exchanges, the sell order cleared all available bids and caused the price to drop to ~$47,000 before recovering instantly,” 0xTimberJ wrote.
Lighter is a growing decentralized perpetual exchange looking to challenge the Hyperliquid category leader. Perpetual futures contracts, or “perps,” have become the dominant derivative product in crypto, allowing traders to use leverage and take long or short positions 24 hours a day, without contract expiration.
The platform briefly captured significant market share last November, processing more than $292 billion in monthly volume, or about a quarter of the $1.15 trillion traded on exchanges, according to data by The Block.
But activity has slowed significantly since its symbolic release at the end of last year. Traders who ramped up their activities to reap rewards have since pulled out, and monthly volume fell to $70 billion in February in a total market of $500 billion, behind competitors such as Hyperliquid, Aster and EdgeX.
