Topic: The vast majority of trading volume was faked. (Read 293 times)

It seems that faking a trade volume is not a new thing I am afraid. There has been some news about CoinMarketCap faking trading volumes. I don't understand why they choose to fake trading volumes.

Nothing new. Faked exchange volumes revolving around cryptocurrencies has always been there and never really left albeit the governments being strict about it and implementing regulations concerning such kind of activities. Either way, I’d still choose a hands-free environment for bitcoin and crypto knowing that that was what the aim of crypto is: to be completely disassociated with any governments’ rule/authority. But then again, the citaens together with the money they’re using are still subject to these laws, and so does the exchanges facilitating the trades.

I wanted to say that that's old news but even one of the articles you've posted dates back to March 26th, 2019. There've been talks about faked trading volumes, and it seems problematic to solve this problem, even though every transaction is recorded on blockchain... I think the problem is that there are too many addresses, too many transactions happening at once. And while even coinmarketcap has been accused of publishing lists based on faked volume data, it's not like we have anything better or can offer a solution that will solve this problem once and for all. This data can't be trusted, but then again, does it matter that much?

We should be glad the the authorities are aware of this fake volume and wash trading happening in the industry but I hope they have a plan set in place to get rid of it because clearly the first ones to be affected by this are us traders who get deceive by fake data happening in the market. Bitwise did the right thing on identifying this anomalies happening in the market but I hope they also included the names of this exchanges to be avoided because 71 exchanges is a lot to hide and we might be using one or two of them, the risky thing about this is if the authorities will also hunt them down with out notifying us and giving us a chance to pull out our funds from their exchange.

Regulations will keep these sudden manipulation at bay but this might make crypto look like centralized which might lead to exit of some big whales as nobody wants their finances controlled by a third part or government.  I feel we need an independent site which will update us about these suspicious activity so that users can be aware.  But we have to live with these manipulations as that's the only thing which keeps crypto alive.

Basically, it is their way to earn profit in their respective exchange or platform. For me, as long as the manipulation (no matter if people does it or not) is aiming to increase a market price of a certain crypto, it is quite good. But if they are going to manipulate the market through other crypto being affected negatively, I can say, regulation not to the crypto itself is needed, but to the exchange who are controlling the market.

P2PB2B is notorious on this they claimed to hit the number one spot but on a survey, they are not even preferred by traders, we should not trust this kind of exchange if we invested in a new coin ask the dev to not submit to that exchange, the community are fully aware what exchanges are doing honest reporting I have new coins listed in P2PB2B but prefer to get it listed a more trustworthy coin, because there are bad reports too about this exchange.

Can't read the WSJ article without a subscription, but I did read the first paragraph at least.  The key word is 'unregulated' when describing these exchanges that inflate their trading volumes.  Legitimate exchanges won't do it or would even need to. 

I like how they describe the crypto scene as 'nascent' because it really is, especially looking at how many exchanges there are and how little regulation there is.  But honestly I couldn't care less if exchanges lie about trading volume as long as they don't manipulate trades or the prices of coins.  I am assuming they fake volume to make themselves look like a more successful exchange than they actually are...?  I can't think of another reason why they'd do that.

Also it's very good to see bitcoin getting press coverage in a major newspaper like the WSJ.  It just adds a nice shot of affirmation that bitcoin is becoming mainstream.

I do not know why everyone wants to get their panties in a bundle about trades being faked. It is something that has been done by exchanges for many years and it is quite expected when there are a large amount of exchanges, competing for market dominance. 

The regulators should audit the exchanges on a regular basis to highlight this more and to lessen it's affect on the markets. We saw this being done in the early stages in Japan, when that got out of control. A lot of the Japanese and Chinese exchanged were forced to close their doors to force them to stop doing that.   

This is a cheat exchange strategy to make it look attractive, that is usually done by new exchanges that have few traders, they will do everything they can to attract traders, including volume manipulation..

even street hustlers playing the 3shell/card trick do similar tactics. they have a 'friend' jump in who pretends to be a stranger, picks the right option to get a win, gets paid the reward and walks off leaving the suckers to think thy have a chance of winning too

its a way to fake looking honest, having more popularity by having more people playing at any time to tempt naive people in by paying out at a win. when reality the pay out/only wins are the hustlers friends

The fake trading volume comes from the exchanges who have been trying to get more customers into their business , actually when the sites are showing a high density of trades , people tend to trust it more , everyone's like * see so many people use this already , it cannot be a scam *
Also it is just a business strategy we could see 1000's of examples everyday in today's business , that's just how they think it works..  not everyone is going to be true you know.

'wash trading' is a thing that happens even in fiat markets

the way it works is imagine 3 people want to buy at exactly $8001.12
(a)0.1 (b)0.2(c)0.3 total 0.6
on a market the order line just shows as 0.6 but within this orderline the washtrader(c) always puts their trade first

not only does it mean they can match their sell trade to their buy trade by being first. but also they have more control of setting prices and taking advantage of market changes by being first inline in every deal

i guarantee you if your an outsider putting in an offer, your offer at any price will not be the first inline to 'take'
its how many fiat and crypto exchanges work.no exchange will let its customers benefit first from good market movements.

and its use of this tactic that lets user (c) who is always first inline be able to buy and sell multiple time even when there is no price movement, even when there are other customers waiting for their orders to fill, to be trading before everyone and thus increase the volume before actual users get their orders filled. thus inflating the volume.

exchanges also done ghost orders in the past. which is inverting the 'wash trading' tactic
imagine (a)0.1 (b)0.2(c)0.3 total 0.6 and although the price was $8001.12, they put their order at $8000
with (c) last. thus if the price went down to $8k the orders eat up (a) (b) first.
this means that (c) can put in a big number of say 100 coins and create a 'wall' using ghost funds(made up/fake) so that if the price got near their order they still have time to cancel their order while (a)(b) is getting filled.

this was done most notably by mtgox many years ago to create walls to sway users that its impossible for the price to break below the large wall.  thus people start trading in the opposite direction thinking the wall is good support/resistance barrier

Have these news websites ever reported that how much fake volume is being shown by the major stock exchanges around the world? Even with regulation there is a lot of faked volume being generated on these major trading exchanges by various brokers. Crypto is nothing different. It's just a bit easier to fake out here. But I think the major issue is not fake volume being shown main problem is the botty trading happening on exchanges which actually drives the prices up and down in an absolute opposite direction of the anticipation of majority of investors.

Yes, Fatbtc. If you look regularly at the exchange rank in Coinmarketcap, you would know Fatbtc comes into the top ten rank several times. This is how CMC got manipulated by these shit exchanges! Even today, Fatbtc rank is top 9 in CMC by adjusted volume and 11 by reported volume, you should check now!

It does not matter if the article is old, most of us know that exchanges have been taking volumes for a long time and no one can do anything about it. Only strict regulation and heft fines can be the answer to these kinds of frauds.

Even if it's posted last 6 months, I doubted that it change as we still see first hand that there is still faking of volumes. And that isn't surprising. What I do now is just use CMC to see for the list of sites. I don't easily deposit my coin/token unless I see there's good order.


Seriously? Fatbtc? That's a dead exchange site. I think you're mistaken when you say one of the top.

Isn't this old news?

I mean, the story is from March of this year when Bitwise shared its report with the SEC for its ETF proposal.

It doesn't make sense to discuss something like that now

This is a drawback for the crypto industry and that's why I want to leave Centralized exchange platforms, and this is why we need the DEX at higher rank! Only a very few exchanges have hundred percent real volume, othwerwise, most of them have fake/bot volume. The sad part is, many people follow the CMC rank for the exchange, they think Coinbene, BW, fatbtc are one of the top exchanges, but everyone should know the reality by checking these links and Coingecko's trust score!

Guys, please realize that OP posted a link to an article that was posted almost 6 months ago. Both of the articles where from late march of this year, and might not be as accurate as nowadays due to the changing nature of crypto-currencies.

Then again, this is pretty true and it's almost common knowledge to most traders that a lot of volumes is faked or manipulated, when you go on CMC and you see these crazy numbers from Asian exchanges, it gets quite obvious.

Even popular exchanges like Binance and Huobi have been accused of market washing/market manipulation, and it's commonplace in crypto.