Bitwise Asset Management, one of several U.S. firms seeking regulatory approval to launch a bitcoin exchange-traded fund (ETF), has estimated that 95 percent of bitcoin trading volumes are faked. Mar 26, · Now, in a twist, a company hoping to list an ETF has reported to US financial regulators that around 95% of all Bitcoin trading volume has been faked by exchanges. Bitwise, a crypto-asset Author: Mike Orcutt. Apr 22, · The issue is that the vast majority of Bitcoin trading volume is fake and/or non-economic wash trading, according to Bitwise. While Bitcoin spreads can be hundreds of dollars on many suspicious exchanges, the spread on real exchanges is typically just a few cents, making it among the tightest quoted securities in the world.
Bitcoin fake trading volumeBitcoin Trading Volume Review: Website Dedicated to Fake Crypto Exchange Activity by Bitwise
Average price deviations between the ten trsl exchanges is very low, according to Bitwise, and sustained deviations are extremely rare. As one would expect with a maturing spot market, Bitcoin futures have become increasingly popular.
The Bitwise report suggests that the Bitcoin market is becoming more mature, but there are many skeptics that believe there is still a lot of cause for concern. In particular, the inclusion of Binance and Bitfinex as two of the ten exchanges with actual trading volume has been called into question because neither have the level of banking relationships or transparency as the other eight exchanges — even though they account for about half of trading volume.
The Bitwise report suggests that Bitcoin may be a smaller and less volatile market than prices would suggest when looking at common price aggregators. In many ways, that could make the market more attractive for investors that are more interested in diversification than rampant speculation. Many institutional investors are interested in cryptocurrencies because they are not correlated with other financial assets, such as stocks or bonds.
No-name exchanges fill out the top 10 per-visitor reported volume. The statistics show that crypto is still very much the wild west.
Madore has written for CCN since He lives in Maine, USA. A single father of four young children, he does not discourage financial donations, provided they do not come with strings attached. Author: P. Madore P. Bitwise used various data-driven tests as assessment methods to determine whether the volume on an exchange is fake. The tools included identifying exchanges with large trading blocks as well as those that have equal volume spikes, which are attributed to all the trades being on the same market.
In addition to identifying exchanges that inflate their trading volumes, Bitwise reports that of the 81 exchanges analyzed, only 10 of them provide legitimate trading volumes. If we want crypto capital markets to go mainstream we need data investors can believe in. Editorial Team is a gracious group of giving cryptocurrency advocates and blockchain believers who want to ensure we do our part in spreading digital currency awareness and adoption.
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