Cryptocurrency exchange volume: More fake than real?

[seleme]

Yes you are right in this situation we are very confused to pick the right exchanges to exchange our investment but in most of the time when you people cannot choose the right one in sometimes for that day experience will play an important role about picking the right one for their exchanges.

It is not tough to detect the fake volume on the small exchange. The giant exchanges like Bitfinex, Bitstamp can use the automated bots for increasing the trading activity and this will help them to push up on coin marketcap listing sites. Fake volumes can attract more investors to the exchanges but it will explode sooner and slower.

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[Eildosa]

That's true. There were many situations when some shit coins had large volumes, which came out of nowhere. Therefore, we must be more careful and pay attention to other factors when buying a coin.

[poodle63]

Yes you are right in this situation we are very confused to pick the right exchanges to exchange our investment but in most of the time when you people cannot choose the right one in sometimes for that day experience will play an important role about picking the right one for their exchanges.

It is not tough to detect the fake volume on the small exchange. The giant exchanges like Bitfinex, Bitstamp can use the automated bots for increasing the trading activity and this will help them to push up on coin marketcap listing sites. Fake volumes can attract more investors to the exchanges but it will explode sooner and slower.

I have seen bots already used in binance exchange but i rarely seen that used in bitfinex or bitstamp. Basically, the trading will create noise and increase the volume and sometimes there was someone that used two accounts to create fake sell and buy order in the market. How can you accurately determine the fake volume will destroy the exchange site itself? Just curious about that. Even the institutional looks so difficult to create audit about that

[SirLancelot]

It's fairly uninteresting, IMO.

Sure, you can get some useful information at a glance, but there are a couple of fields which are either not useful, or quite misleading. For example, the suspicious volume reports are based on their previous findings, which as I've already explained are based on using fairly shaky methodology. Also, having a "Formal Market Manipulation Policy" doesn't mean very much if you choose not to follow it and manipulate the market and insider trade anyway (e.g. Coinbase). I wouldn't use it to choose an exchange, as it ranks exchanges like Coinbase and Bitfinex amongst the best, and I wouldn't trust either of those to hold any of my money or details, ever.

Thanks for the reply. Agreed that both Coinbase + Bitfinex shouldn't be amongst the best.

So just wondering, which source(s) do you use to help you decide on what exchanges to use? Haven't managed to find any good sources.

Thanks.

I agree that there might be some exchanges that would not be great and would be using fake reviews and trading volumes but there is really nothing to worry about because you get to know about an exchange that is not great and is actually making use of maybe fake trading volumes to attract users. Always go for the best exchange and i think Binance despite witnessing a bad hack is still the bests out there. Bittrex used to be the best.

[Whosdaddy]

This is not longer a new thing and I'm not surprised. You're not the first person to post this here, I have seen someone post something that is similar to this after they have conducted a research and found out that majority of the exchanges are using fake volumes to operate, I can't really remember where exactly in this forum I saw that post.

And they do all these just to deceive people and make them feel they are big exchange, but the truth is that they are not, most of them are wacks. Only bigger exchanges just like that of Binance are the ones that don't really do that, based on their research. So I'm not really surprised seeing this one too.

[dat.ho12492]

This is not longer a new thing and I'm not surprised. You're not the first person to post this here, I have seen someone post something that is similar to this after they have conducted a research and found out that majority of the exchanges are using fake volumes to operate, I can't really remember where exactly in this forum I saw that post.

And they do all these just to deceive people and make them feel they are big exchange, but the truth is that they are not, most of them are wacks. Only bigger exchanges just like that of Binance are the ones that don't really do that, based on their research. So I'm not really surprised seeing this one too.

Yes, this is no longer a new information for traders and investors, exchanges always provide a fake trading volume to attract and advertise, there are not too many exceptions, large or small exchanges, more or less, they always create this fake information. However, people probably don't care too much about this because they know what is good for them, they know how to exchange prestige, they don't care about real or fake, they only care about the profit and what that exchange can bring to them

[LUCKMCFLY]

Haven't seen this posted here so just wanted to share.

Recently The Tie released their findings of a study on the extent of volume manipulation by cryptocurrency exchanges. To no one's surprise, they found extensive manipulation amongst many cryptocurrency exchanges.

In total we estimated that 87% of exchanges reported trading volume was potentially suspicious and that 75% of exchanges had some form of suspicious activity occurring on them.

Link to Tweet: https://twitter.com/TheTIEIO/status/1107671178423033858
Single thread for ease of viewing: https://threader.app/thread/1107671178423033858

The Blockchain Transparency Institute also publishes a list of exchanges that are suspected of inflating their trading volumes. Since different methodologies and samples were used, different results should be expected. But just for fun, how do their results compare against those of The Tie's? We used The Tie's "Low Potential Fake Volume" exchanges and compared them to Blockchain Transparency Institute's latest reports and this is what resulted.

Our lay man's conclusion: Pretty close match if you ask us.

Legend

The Tie
1. tick = a Low Potential Fake Volume exchange

BTI
1. tick = not on the exchange advisory list ie. not suspected of manipulating volume.
2. cross = on the exchange advisory list ie. suspected of manipulating volume.
3. blacked out = not covered by BTI research.

It is not that it is more false than real, what happens is that each Exchange handles its own volume, they do not have the consolidated volume, and in fact the actual volume almost by many Exchanges is not very well displayed.

To analyze the volume well, it is necessary to have the consolidated and still does not exist, there are still missing tools or pages where the contents of localbitcoins and some Exchanges that are Koreans, since these volumes do not have enough analysis of the market as such, because There is a lack of information, and each Exchange manages the volume of each one, which always guides me is Bitfinex, since that is where all the major movements take place, but nevertheless, it is necessary to review the volumes of all the most important Exchanges, for have a much more complete analysis.