The computer made a rudimentary calculation error, the data network caused the Bitcoin price to 'collapse' to $ 5,400

Yesterday, a cryptocurrency data network operated by the most prestigious investment firms on Wall Street made a fatal mistake when it displayed a 90% drop in the price of Bitcoin compared to the number that exchanges have shown. other is displayed.

This flaw belongs to the Pyth platform, seen by its advocates as a professional source of information for valuing information about assets such as stocks and cryptocurrencies. The organizations behind it are all financial giants including Jump Trading Group, DRW and FTX.

As important, but this past Monday, the data platform showed Bitcoin price at just $5,402 – 90% lower than other exchanges that were showing Bitcoin price around $42,000 at the time.

The computer made a rudimentary calculation error, the data network caused the Bitcoin price to 'collapse' to $ 5,400 Picture 1

After more than a day of investigation, Pyth released his initial report on the cause of this incident. According to Pyth's explanation, "the problem was caused by a combination of two different Pyth data providers reporting near-zero BTC/USD and an overestimation of the logic algorithm. high contribution of these two publishers, as well as both publishers having problems handling decimal numbers at the same time."

The first data provider got an error when they sent their price to Pyth as a floating-point number when it should have been an integer (integer). Instead of sending an error message, Pyth's system converts the number submitted to a price close to zero and publishes it.

The second data provider encountered a software conflict that resulted in it giving the BTC/USD price as an exponent of 10^0 instead of 10^-8 for 2 minutes of the crash. This price display error has resulted in some people liquidating their positions in Bitcoin, Pyth said.

The computer made a rudimentary calculation error, the data network caused the Bitcoin price to 'collapse' to $ 5,400 Picture 2

Now things seem to have returned to normal as the price of Bitcoin is being displayed at $41,888, which is very close to the price common in other exchanges.

Right now, Pyth says, its core developers are taking steps to prevent this problem from happening again.

In just a short time, this is the second time in a row that Pyth has crashed. The capital is connected to the Solana blockchain, so when the network went down for more than 17 hours last week, the Pyth platform was also taken down.

Jessica Tanner

Update 23 September 2021