What Is the Primary Cause of Price Gaps in the Crypto Market?

The primary cause of price gaps in the 24/7 crypto market is low liquidity and sudden, high-impact news events, particularly during periods of low trading volume, such as late nights or weekends. While crypto trades continuously, large institutional traders often reduce activity during these times.

A major news event can trigger a cascade of liquidations or market orders, overwhelming the thin order book and causing a rapid, gapped price change.