- Crypto is one of the most volatile markets requiring investors to be on guard to make investment moves.
- Unfortunately, most exchanges experience outages due to high traffic and limit investors.
Exchange outages are nothing new but with the crypto market has gained a crazy amount of mainstream traction over the last year or so, such issues are becoming increasingly more common.
For example, on May 19th, a day when the crypto industry witnessed mass liquidations across the board — resulting in the total capitalization of the sector to drop from $2.1 trillion to $1.65 trillion — a number of “premier” digital asset trading platforms such as Binance, Coinbase experienced operational lapses, causing many investors to lose their funds as they were not able to initiate any damage control measures for a substantial period of time.
Following the debacle, Coinbase swiftly issued a statement claiming that it was investigating its intermittent downtime while Binance CEO Brian Brooks gave an interview promising customers that his company’s dev team is actively looking to overhaul their entire operational setup and address any issues that can cause episodes similar to this most recent outage.
Lastly, it bears mentioning that another similar scenario also played out recently when India’s largest exchange WazirX went offline, resulting in many of its customers not being able to “buy the dip”. While company CEO Nischal Shetty claimed that the outage was solely due to the fact that the trading platform had been witnessing a traffic surge of more than 400%, it is interesting to note that WazirX was also on the receiving end of another major operational glitch on May 6th, a day when the value of DOGE was pumping heavily and investors were cashing out their profits en masse’.
There are two ways to circumvent the “outage” problem
It is quite obvious that whenever there is a crash in the crypto market, a lot of investors dump their positions so as to minimize their losses. Many a time under such circumstances major exchanges may go offline due to increased transactional activity, network load, etc, however, through the use of third-party trading interfaces, it is actually possible for users of these platforms to continue trading even when the central exchange itself is down.
For example, Atani is an all-in-one crypto trading platform that provides users with secure, streamlined access to trading and portfolio tracking across a total of 20+ exchanges. Owing to the fact that Atani is connected directly to the API of many prominent cryptocurrency exchanges — including Huobi, KuCoin, Coinbase Pro, Binance — it enables users to trade seamlessly during drop hours, allowing for maximum monetary leverage.
This is made possible thanks to the decentralized nature of most crypto exchanges in the market today. Since most trading platforms allow for third-party applications to integrate with them via the use of API keys, it becomes possible for individuals to access and utilize their funds at all times. In comparison, the legacy finance system is completely centralized, with individuals having to rely on their banks for every small thing all while being offered little to no transparency in terms of how their funds are being stored, handled.
The crypto market is primed for future growth
As more and more people begin to understand the consequences of increased fiat printing, fears of inflation and currency dilution are increasingly looming large on the horizon. To put things into perspective, over the course of 2020 alone, the United States government issued more than 35% of all US dollars currently available in circulation.
Similar money printing moves have also taken place across other parts of the world including Asia, Europe, leading more and more people to seek out tangible long-term stores of value that can help investors maximize their savings. And while some investors have turned to traditional assets such as real estate, precious metals, etc, over the past year or so, cryptocurrencies — Bitcoin in particular — have emerged as an asset class that more and more people all over the world are beginning to view as a hedge against fiat inflation.
Lastly, the growth of the industry has been so rapid that even many traditional banking giants such as JP Morgan, Morgan Stanley, BNY Mellon, amongst many others have started offering their clients various crypto products (such as custody solutions). Not only that, an increasing number of institutional players — like PayPal, Microstrategy, Tesla, Visa — too have made inroads into this sector.
Thus, it stands to reason that as we move into the future, the crypto market will continue to witness an increased amount of growth and therefore it is in the best interest of investors to become technically savvy about all the ways in which they can trade their cryptos, even during periods of outages.