In recent months the news you can find about fake cryptocurrency transactions. CoinMarketCap and other services spend a lot of effort to eliminate counterfeiting trade volumes, but how much remains to be done.
To identify the reasons why some exchanges are trying to inflate the amount of his trade, is quite difficult. High number of transactions that usually means that the platform sells a large number of users. Seeing the platform with a significant user base, consumers feel more secure.
Thus, the fake transaction exchanges to help attract new users, creating the illusion of a growing client base.
In addition, stock exchanges profit from the transaction of cryptocurrency, and having high trading volumes, platforms may charge companies a higher fee for listing coins.
To increase their volume of trading of the exchange behave very creatively, using different tools. In the report of the team for cryptocurrency trade Alameda Research, with offices in Berkeley and Hong Kong, lists some of the above.
Using six different criteria and meticulous study of the book of orders, the company tried to determine how are fake transactions.
Some exchanges include the fake transactions in large amounts in the actual number for small amounts. All of this makes them difficult to detect.
Another method, called money laundering, using different addresses of wallets to send large transactions back and forth. These purses belong to the exchange or its subsidiaries, thus moving the coin does not go beyond the trading floor. In the traditional markets of most countries this practice is illegal.
According to the results of the Alameda, is now in the cryptocurrency market daily is trading at $38 billion genuine transactions. Of these, 87% are in Asia and only 9% in the USA, which is associated with different approaches to regulation in each of the regions.
In an effort to minimize inaccurate reports, CoinMarketCap has created the Alliance for accountability and transparency (data). The group aims to encourage exchanges to improve their transparency.