Kaspa's (KAS) Flash Crash Wasn't a Bug, But a Wake-Up Call for Crypto

The Kaspa price finally broke $0.080 resistance again after pumping 10% last week. However, KAS community is not happy with something like this and there are many 10-50x price predictions floatin

Kaspa (CRYPTO: KAS) price has finally breached $0.080 again after gaining 10% last week. However, the community isn’t happy with something like this and there are many 10-50x price predictions floating around on X.

‘Kaspa Report’ X profile who has a relatively small following of 5k still, posts viral, extremely useful threads about what’s going on around Kaspa on exchanges and beyond. They again posted a thread last night about some interesting updates on different exchanges.

CoinEx Flash Crash Phenomenon

Last month, cryptocurrency exchange CoinEx witnessed an extraordinary event as highly leveraged margin traders engaged in activities that manipulated Kaspa’s price to nearly zero.

This wasn’t just another crypto flash crash – it was a perfect demonstration of exactly why decentralized currencies like Kaspa exist in the first place.

The flash crash pushed Kaspa’s price down to just $0.004621 against USDT on CoinEx. Then something amazing happened. The price shot back up, rising over 1,800% from its lowest point. But the real story wasn’t about the crash. It was about what came next.

Highly leveraged margin traders on CoinEx pushed the price of Kaspa to nearly zero on that exchange last month.

The crash triggered an unexpected supply shock on the exchange. In just five minutes, the majority of all Kaspa disappeared from CoinEx’s wallet. The reason was simple but profound – there simply wasn’ bật le enough Kaspa on the exchange to support the excessive short margin trades that had been placed.

Each time CoinEx attempted to replenish its Kaspa wallet, leveraged margin traders quickly drained it again. This cycle continued until the exchange had no choice but to halt Kaspa margin trading completely as of February 10, 2025.

What happened on CoinEx represented a perfect storm. Three critical factors came together: leveraged derivative trading that artificially suppressed Kaspa’s price, active spot trading of Kaspa, and unrestricted Kaspa withdrawals. This combination created an environment where price manipulation ultimately backfired on those attempting to control the market.

Kaspa’s inherently decentralized nature proved to be its greatest strength during this incident. As centralized entities tried to suppress its price, they inadvertently subsidized KAS for holders who continued to accumulate through exchanges that allowed withdrawals. This dynamic created a situation where price suppression actually amplified the accumulation by dedicated holders, rendering the manipulators increasingly vulnerable to a short squeeze.

Resilience Against Market Manipulation

This incident showcases how Kaspa’s unique design makes it remarkably resilient to manipulation by centralized entities. Through what Kaspa Report calls “unparalleled decentralizing power,” Kaspa appears to be positioned to defeat price manipulators and challenge the centralized control of the market.

This flash crash incident wasn’t a failure of the Kaspa system but rather a validation of its core principles. It offers a glimpse into a potential future where decentralized finance becomes the standard and today’s centralized markets may eventually be viewed as outdated relics of a less evolved financial era.

The CoinEX crash was a big win for Kaspa fans. It proved their point. Even when big players try to mess up the market, truly decentralized coins like Kaspa can fight back. What looked like a disaster turns into a perfect example of why Kaspa works.

MEXC’s Withdrawal Restrictions Raise Concerns

But CoinEx isn’t the only exchange causing problems for Kaspa users. Kaspa Report recently revealed that MEXC has been blocking Kaspa withdrawals for over 206 hours – that’s more than 8 days straight. The exchange claims it’s just doing “wallet maintenance” but hasn’t said when users can withdraw their coins again.

Now, this isn’t how serious financial services should work. Good platforms aim for 99.999% uptime, which means just 5 minutes of downtime per year. But MEX