Showing posts with label coinbase. Show all posts
Showing posts with label coinbase. Show all posts

Monday, October 15, 2018

Manipulation on major exchanges: Coinbase even overstates the volume of trading

Manipulation on major exchanges: Coinbase even overstates the volume of trading

Manipulation on major exchanges: Coinbase even overstates the volume of trading


The report of the Prosecutor of the state of new York (OAG) "Initiative to ensure the cleanliness of virtual markets" says that several platforms have resorted to artificial increase in trading volume, including Coinbase. On these exchanges there were discrepancies with the actual volumes.

This is a phenomenon of own trading, when the company for its own benefit conducts transactions instead of trading on behalf of its customers for a Commission. Own trading not only provides income, but also serves as a factor in increasing liquidity, For example, the chance to execute a client's order is higher if real buyers or sellers do not place offers. The OAG document says: "Such activities [.....] requires increased customer protection and transparency of transactions to comply with the law."

The problem is that the user can suddenly lose liquidity and generally have a false idea about trading volumes.

The entire text of the investigation is presented in an official document.

Investigation


The new York city Prosecutor's office has checked 13 exchanges, including such large sites as Coinbase and Bitfinex. As a result, five exchanges are seen in unfair trades on their platforms. The volume of trading activity does not correspond to the actual indicators. At Coinbase it is 20% of the wound orders at the expense of transactions on own platform. Some exchanges, such as Kraken, did not participate in the investigation and publicly announced it. OAG States that half of the audited exchanges admitted in an artificial increase in trading volume.

The investigation also considers other factors: service availability via VPN, Fiat pairs, verification.