Wash trading and artificial volume inflation are to be expected in a thoroughly unregulated market. But this data shows the true scale that it is happening and it is frightening.A research experiment was recently completed. The data was calculated by collecting order books from all major exchanges, and to measure how badly market selling $50k USD worth of each cryptocurrency would crash the price.(pesky Reddit doesn't allow pictures. I'll provide a link to the group that has this data)Anyways I'll do my best to explain the charts. They are a representation of the average slippage and volume of all pairs among a selection of a score of cryptocurrencies with a daily volume over $100k over four major exchanges: OKex, Kraken, Bitfinex and GDAX. Slippage refers to the difference between the expected price of a trade and the price at which the trade is actually executed . There is a ridiculous amount of discrepancy between exchanges.Here is an example taken from the data. The GDAX pair, with a volume close to $200m has a slippage of less than 0.1%. The chart is striking. It shows how, although all first three exchanges seem to behave rather similarly, OKex pairs, in red, all have a massively higher slippage with regards to their volume.(again sorry I'll provide the link to the group that did the research below)Not convinced? Here there is more data gathered that may persuade you to think differently.At this very moment, you can check coinmarket cap and look at the volumes of EOS being moved. Bitthumb, and OKex are responsible for the majority of the volume being moved. Without a doubt, EOS is being wash-traded. These volumes are insane and are following a clockwork pattern. Higher volumes create the illusion of more demand and as a result falsely inflating the price.For those who think “Crypto doesn‘t need regulation!”...Take a look at the evidence. Because as it stands the state of crypto is arguably a testament to the failure of the free-market.I couldn't provide the link to the direct data because it is in a group post but I cannot recommend you looking into this enough. The empirical evidence is there and the proof is in the pudding so to speak. If there is one article you should read, it is this one. Seriously it is concerning.https://ift.tt/2Hv2ou0
Submitted April 30, 2018 at 12:33AM
No comments:
Post a Comment