New study submitted to the SEC by Bitwise Asset Management claims that 95% of the reported BTC spot volume is counterfeit. According to Bitwise, only 10 exchanges have an actual volume … but that's not only bad news for the bitcoin market.
95% of Bitcoin stock market volume is counterfeited
Claims of laundering and counterfeit volume are nothing new. Groups like the Blockchain Transparency Institute have published more and more detailed reports on this topic. But the suggestion that 95% of the volume is counterfeit marks a new high (or low). The main reason for switching to counterfeit volumes is to increase the fees that can be charged.
1/ New Research by us @BitwiseInvest .
Under 226 SEC filings In our ETF deposit, we conducted a unique analysis of the * order book data * of all 81 exchanges that report a $ 1 million BTC volume on CMC.
TLDR: 95% of the reported volume is fake but LOTS of good news! pic.twitter.com/TuXLlDCRyP
– Bitwise (@BitwiseInvest) March 22, 2019
According to the study, only ten exchanges have an average daily volume of CoinMarketCap over 1 million Dollar sign original. These are Binance, Bitfinex, Kraken, Bitstamp, Coinbase, BitFlyer, Gemini, itBit, Bittrex and Poloniex. The report ruled out the Korean exchange, and Cex.io passed the test but had a volume of less than $ 1 million.
Many exchanges do not even try to cover it
The report presentation gives a good comparison to show how to recognize a reality by swapping a suspect. If you compare the two sides next to each other, some stock market faults appear blindly obvious.
In a true stock market trading, the distribution between buying and selling will be random; The amounts will be both large and small and will contain a significant number of rounds. Vol The volumes will fluctuate over time, with more busy and quieter periods and the spread (difference in buying and selling price) typically being only a few cents.
On the other hand, suspicious exchanges often have deals made in pairs (a buy and a sell). , It is very unlikely that real trades will occur in such a pattern. Trading deals are similar, there are no very small trades and despite the preference of people for round numbers there are no "round numbers".
Suspicious stock exchanges are likely to have a higher spread despite allegedly massive volume. Volumes will remain roughly constant over time, or may be completely out of action for hours or even days.
This smaller market is "neater" for Bitcoin ETF.
So Bitwise promised us good news. But in reality, it is rather good news for them. Because this investigation was actually submitted to the SEC to support Bitwise Bitcoin ETF application. The good news is that there is a fake despite alleged 95% of the volume:
The real market for Bitcoin is significantly smaller, more orderly and more regulated than commonly thought.
Well, whoopee-doo! The bad news is, of course, that dodgy exchanges now know how to tweak their bots to avoid detection.
Do these Bitwise investigations have a positive effect on their Bitcoin ETF application? Share your thoughts below !
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