Since the crypto market crash and the subsequent crypto winter, exchanges have had a hard time surviving, as controversies surrounding these platforms had a detrimental effect. A new wave of debates and discussion have taken over the cryptoverse after Tie report was published earlier this year. In a fresh take on fighting cryptocurrency fake volumes, The Crypto Lark, New Zealand-based crypto personality, spoke with Bobby Ong, the co-founder of CoinGecko, a cryptocurrency ranking website.
The cryptocurrency market data aggregator recently launched a “trust score” to provide a fairer picture of the market. Talking about the new rollout’s use case and touching upon the controversial subject of fake volumes by crypto exchanges, Bobby Ong stated,
“The 24-hours the reported volume of exchanges in the crypto space longer a good measure of exchanges liquidity. So in a traditional market volume from exchanges is a good indicator of how liquid exchanges are. So higher volume will indicate that the exchange actually has high liquidity and low volume indicate actually lower liquidity in the crypto market”
However, Ong stated that the “incentive to cheat is very high”. The unregulated nature of the space poses a big threat where anybody can masquerade as a big exchange constituting for the highest trading volume in the world by using “questionable techniques”.
According to the co-founder, these entities, under the pretense of high volume, sell the idea that they’re the biggest exchange to lure people into trading on their platform and subsequently increase traffic.
Ong alluded that a 24-hour reported volume is no longer useful and that there is a need to look at metrics beyond reported trading volume to understand the exchange’ s liquidity.
Applauding CoinGecko’s initiative, Crypto Lark commented,
“.. you guys are making a lot of friends and a lot of enemies at the same time”
He emphasized the need of the community’s trust for a reliable source of information regarding exchange volumes. The crypto market is plagued with manipulation and misinformation in the market, Crypto Lark cited and further said that these “trust scores” are very important in the unregulated space to keep checks on different platforms.
Subscribe to AMBCrypto’s Newsletter
Bitcoin Cash [BCH]: ‘The real Bitcoin’s’ hardfork spectacle grabs the attention of the entire community again
Chayanika holds a Journalism degree and is currently working with AMBCrypto. She is inquisitive about everything that the Blockchain Technology has to offer.