March 10, cryptocurrency trader and researcher Sylvain, Ribs published a report which claims that $ 3 billion of trade volumes cryptocurrency — fake. The author of the study made a special emphasis on cryptocurrency exchanges Okcoin (Okex) and Huobi. But let’s take first things first.
The essence of the study is to estimate risks. Ribs decided to calculate how much selling each and every token valued at $50 000 would bring down its price.
Further, Ribs refers to the term “slippage,” which he defines as “the percentage change observed between the average and minimum price at which he had to agree, selling the asset”. The study of the books of applications for such exchanges as GDAX, Bitfinex, Kraken, Binance and many others, was discovered enormous discrepancies:
“I have discovered a huge discrepancy between the exchanges. On this you cannot give up and just say “well, users are supposed to be different”. The presence of such discrepancies can only be explained by the fact that some figures are very inflated, up to 95%. Topping the list of cheaters exchange Okex, with the stated trading volume to $1.7 billion, and occupies the first position in the Coinmarketcap sites and Livecoinwatch”.
Orange, blue, and blue marks belong to the GDAX exchanges, Bitfinex and Kraken, respectively. The red marks owned by Okex:
It is the trading volume Okex steel alarm bell for Ribs. The trader recognizes that on the unregulated market of crypto-currencies can detect artificial and fictitious volumes of trading, but to such an extent!
“Many currency pairs, though, and boast up to 5 million dollars, but when you slip them the price will be slightly more than 10% , you should only exchange $50 000. To such couples at the time of data collection 06 March 2018 belonged NEO/BTC, IOTA/USD, QTUM/USD”
“These figures do not allow to doubt that a large part of the volume Okex – dummy. Initially I could not understand how they manage that. I went to the platform and looked at the history of trading in some pairs. It turned out that they fabricate the volume to the point of absurdity obvious artificial method”.
Compared to Poloniex exchange Okex shows an exaggeration of the financial markets. Huobi Pro far behind and fabricates 81.8% of the volume. The study also referred to these exchanges as Bittrex, Hitbtc and Binance and found them “respectable exchangers”:
“Check the volume has not led to the identification of suspicious activity,” says Rabs.
CEO Binance Changpeng Zhao studied the research of Sylvain Ribs and called it “good and in-depth analysis”.
With regard to the dubious activities of Okcoin and Huobi Pro, they were asked to comment on the results of the study, but there was no answer. It is worth noting the fact that these two exchanges is not the first time accused of falsification of the volume of trade. Could this be the reason for the termination of the contract between the company SBI Holdings and the exchange Huobi, which anticipated the opening of two cryptocurrency exchanges in Japan?