Most flash crashes occur due to mistyped or misfiled trading orders at low prices. On exchanges, investors can easily make a mistake in entering a wrong figure for a buy or a sell order.
For instance, a potential Ethereum buyer may have wanted to file a buy order at $13 to purchase the digital asset at the lowest support level possible, but engaged in a careless mistake and filed a sell order at $13 instead.
this only proves that the author not only has never used an exchange in his life but also has no idea how exchanges work.
if for example price of ETH is currently $50 and you place a buy order at $10 your order will NOT be filled at $10 but it will be filled at $50 because the system automatically picks the highest order in orderbook and fills that.
orderbook is like a stack of last in, first out and that rule can NOT be changed.
as a result if you see price has dropped to something like $10 in my example then it means all the orders in the stack were filled the $50, $49.99, $49.98, .... up until $10. in other words that much ETH were sold to push the price that low.
I think someone is trying to repeat history. If it's a mistake by a trader as claimed by coinbase, why doesn't it occur more often? and why isn't the system rectified so that it's mistake-proof to traders just like other exchanges?
Something is definitely not right.
What are your thoughts?
it is not the exchange fault that someone chose to sell that much Ether and the market couldn't handle it. so your real question should be why did the whale dump that much ether and why did others follow him by selling to crash it down to $13?
it might be a bot mistake which sold a larger amount instead of a small one or it may be a dumb whale thinking he can manipulate price by dumping on one exchange instead of all of them at once
if someone wanted to repeat history then they would have dumped on Coinbase, Poloniex, Binance, Bittrex at the same time.