On Christmas Day, many bitcoin traders were shocked when bitcoin suddenly appeared to fall to about $24,000 on Binance. Images of the drop spread quickly on social media, and some people feared a major market crash.

However, the price returned to above $87,000 within seconds. What looked like a huge collapse was actually something very different, and not a real crash.

It was a short-lived pricing issue that happened on one specific trading pair on Binance. Bitcoin’s overall market price never actually fell that low.

The strange price drop happened on Binance’s BTC/USD1 trading pair. For a brief moment, bitcoin printed a price as low as $24,111, then immediately jumped back to normal levels.

Importantly, this drop did not appear on other major bitcoin pairs, such as BTC/USDT, or on other exchanges. Across the rest of the market, bitcoin stayed steady around $87,000 to $88,000 the entire time. During this period, the wider market never valued bitcoin close to $24,000.

The main reason for the flash drop appears to be low liquidity. Liquidity means how many buy and sell orders are available at different prices. The BTC/USD1 pair uses USD1, a relatively new stablecoin launched by World Liberty Financial.

Because USD1 is new, fewer traders and market makers use this pair. That means the order book is thin, with fewer buy orders ready to absorb sudden selling.

When liquidity is low, a single large sell order, a forced liquidation, or an automated trading action can rapidly clear existing buy orders, causing the price to briefly drop well below its actual market value until new buyers step in.

Once the large order passed through the order book, new buyers quickly stepped in. As soon as normal buying resumed, bitcoin’s price on the BTC/USD1 pair snapped back to match prices on other exchanges.

This fast rebound shows that the drop was a technical issue, not a change in how the market values bitcoin. The timing also mattered. The event happened during the Christmas holiday, when trading activity is usually low. Fewer traders are online, and market makers often reduce activity during quiet hours.

Lower liquidity is common during slow market times, such as public holidays or periods outside of peak trading hours. This made the thin liquidity problem even worse. Some analysts also pointed to Binance’s USD1 promotion, which offered high yields and attracted new users. This caused a rapid increase in USD1 supply.

Some traders tried to take advantage of this by selling bitcoin through the BTC/USD1 pair. Because liquidity was low, those trades may have triggered the sharp price drop by accident.

As many believe, this could have been a microstructure anomaly, not a systemic sell-off. Some social media users, on the other hand, claimed the move was caused by manipulation.