Crypto exchanges are being accused of ‘wash trading’ in a new report…
by Manoj Sharma for CNR
A report published by the Blockchain Transparency Institute claims over 87% of the transactions of the world’s top 25 crypto exchanges could be false.And what’s more, most exchanges have turned the process into a money-making habit, the report continues.
‘Wash Trading’ is embellishing an exchange’s cryptocurrency volume. Exchanges, in this instance, oversell their popularity or selling power, which gives them power to charge coin networks $50,000 or more to list their tokens on the trading platforms of those exchanges. Since exchange-listed ICOs are more attractive, these exchanges are also able to charge more for ICO listing.
According to the report, of the 25 exchanges listed on coinmarketcap.com, only two are not involved in some kind of ‘wash trading’. The rest, it alleges, are likely embellishing their trading volumes by 70%. Although these exchanges claim that transactions worth $2.5 billion occur on an average day, the real number is somewhere around $324 million as per the report.
It’s worth noting down that the popular U.S.-based exchange Coinbase didn’t even make the list because those listed were heavily involved in this illegal trade, which Coinbase has refused to take part in. By the time of writing this, the exchange has earned the number 33 spot on the list. It should be noted too that no cryptocurrency exchange has admitted ‘wash trading’, should their very expensive lawyers happen to be reading.
Furthermore, many users have commented on Reddit that the exchanges making the list were either new or didn’t boast the customer base to present such volumes, thus had to be fabricating the facts.