Wash trading is an activity where same stocks are bought and sold simultaneously by the investor showing artificial trade activity leading to price manipulation.It is said that Bithumb,a korean exchange is said to allow wash trading where BCH is most highly traded.It is said that it is the main reason for BCH price getting pumped this much high.Has bitcoin community faced a similar situation in which wash trading was carried out on some exchanges?
I heard of the concept of wash trading before, but in the context of money laundering... didn't know you could manipulate prices with it as well. I guess that such activity wouldn't be too hard to spot though as all the exchanges print the time and sales data. So if somebody does a wash trade, you'd see two trades of identical volume but in different directions. I guess that would be one thing to look out for before you buy!
Potentially. They could also use randomly generated order sizes to absorb various chunks of the book through a variety of accounts then let it go bid (or ask) and start again. There are a lot of different ways to disguise activity and anyone who wants to jump in has to be aware of how markets (and those creating markets) operate and manage risk appropriately.
