The Swiss Franc Flash Crash: A Defining Moment in Forex History

What Happened On January 15, 2015, the financial world witnessed an unprecedented event in the foreign exchange market, commonly referred to as the Swiss Franc Flash Crash. The catalyst was an unexpected announcement by the Swiss National Bank SNB that it would remove the 1.20 peg against the Euro, a monetary policy that had been in place for over three years. The SNB had maintained this minimum exchange rate to protect Swiss exporters and stave off deflation amidst the Eurozone crisis. Immediately following the SNB's announcement at 10:30 AM CET, the EURCHF currency pair plummeted with astonishing speed and severity. Within minutes, the pair dropped by thousands of pips, with many platforms reporting a fall of over 4,000 pips. Liquidity vanished, bidask spreads widened to extraordinary levels, and many brokers struggled to process orders. The EURCHF, which had been trading steadily around 1.20, briefly touched lows below 0.85 on some platforms before recovering somewhat, leaving a trail of bankrupt brokers, margin calls, and immense losses for individual traders and institutions alike. Key Statistics Metric Value Opening Price Approximately 1.2010 Session High Approximately 1.2015 Session Low Ranges from 0.8500 to 0.9500 varied greatly by broker Closing Price Approximately 1.0370 % Change Approximately 13.6% Volume Significantly higher than average, estimated 510x Note: Statistics are approximate based on historical records. The Market Context