Thousands of different transactions are made every day in crypto exchanges, and the daily transaction volume of the exchanges reaches millions of dollars. But since cryptocurrency transactions are anonymous, we do not know by whom, for what purpose.
Bitwise had done some research on these trading volumes in recent months and had an interesting conclusion. According to the company’s research, 95% of the trading volume reported by crypto exchanges is fake. According to the report of Bitwise, most of the transactions in these exchanges are done directly by the stock market management, not by the users, thus increasing the volume of the stock market.
The China National Internet Finance Association (NIFA) also released a report on this issue and made a similar claim to Bitwise.
Founded by the Central Bank of China, NIFA conducts research in many areas and contributes to the regulation of many sectors, including the digital money sector. The new report published by NIFA on digital currencies does not draw a bright picture of the digital money industry.
According to the findings shared by NIFA, the vast majority of the trading volumes that we currently see on crypto exchanges are fake. These exchanges are trying to show a high trade volume just to show the digital money sector well. NIFA shares the following information on the subject:
“Our work on some stock market data showed that 100% of transactions with 40 different cryptocurrencies and 50% of transactions with 70 different cryptocurrencies are transferred back. Although the prices and market values of these cryptocurrencies are low, trade volumes are observed in giant exchanges. ”
It is not clear who he is
The Chinese National Internet Finance Association says there is almost a trading cycle on crypto exchanges, and therefore the volume of many exchanges is so high.
According to the statements made by NIFA, these exchanges use this kind of way to attract more people and grow the digital money industry. Crypto investors do not know the real trade volume in these exchanges, nor do they know who is managing these exchanges.
According to the studies of the Internet Finance Association, people do not know where the offices of many crypto exchanges are, exactly who (s) are managed, the business model of this exchange. In addition, exchanges are not eager to share this information.
The accuracy of these claims made by NIFA is debatable. But NIFA at least makes a right point on lack of information. Because crypto investors need to learn more about the products and services they actually use, and do some more research.