This past Saturday a report was released by a cryptocurrency agent and researcher regarding how he suspects that up to $3 billion worth of cryptocurrency trade volumes, most of it coming from certain exchanges.
Sylvain Ribes, a Cryptocurrency investor and trader, also a former sponsored professional poker player and coach, wrote the report and claims that Okcoin, a digital currency exchanger company all this time has been counterfeiting up to 93 per cent of its trade volumes.
Mr. Ribes’ study has a couple of fascinating news concerning trade volumes originating from Okcoin/Okex, which is also a Chinese digital currency trading platform and exchange based in Beijing. Sylvain wrote that these exchanges may have been falsifying their trade volumes. He calculated his data from order books throughout all top-tier exchanges to, Sylvain wrote: “measure how badly market selling $50k USD worth of each cryptocurrency would cash the price.”
Ribes went on to make mention of the term “Slippage”, a term he describes as the percentage change between the observed mid-spread price and the lowest price he had to consent to sell the asset.
This recent study contains several currency volumes coming from different exchanges like Bitfinex, GDAX, Kraken, Binance, etc. He discovered massive inconsistencies between trading platforms. At some point in the report Mr. Ribes states that: “I found ridiculously massive discrepancies between exchanges. Not the kind that can be easily hand-waved away (oh well, their users must behave differently), but the kind that can be explained by some figures being overstated as much as 95%.”
The volumes of Okcoin/Okex raised alarms and Ribes explains that because the markets are unregulated, artificial volumes and wash trading should be expected. His slippage and volume chart indicates that couples with a daily volume of 100k with all four exchanges over 24 hours. He also added that: Many pairs, albeit boasting up to $5 million volumes, would cost you more than 10 per cent in slippage, should you want to liquidate a mere $50k in assets – Those pairs included, at the time of the data parsing (06/03/18): NEO/BTC, IOTA/USD, QTUM/USD – Hardly illiquid or low-profile assets.
Hitbtc however, a cryptocurrency exchange launched in 2014 has little differences and is a touch less liquid which can be spotted for several reasons. He also states that the results of Binance were more Intriguing, however says that the exchange has a pretty restrictive policy when it comes to API-trading. He finally stated that Inspecting their volume history does not show any obvious suspicious activity. After the study was done and made public, the CEO of Binance stated that Sylvain Rides’ study was a good in-depth analysis.