What Does This Mean for Bitcoin?

One of the biggest concerns voiced by institutional investors and even the US Securities and Exchange Commission (SEC) in cryptocurrency has been that of wash trading and market manipulation. As every financial industry deals with some level of deception, the lack of ethics in a crypto exchange can open the door for wash trading, preventing investors from seeing the true nature of the market. However, in exposing the lies, big changes can happen to improve the crypto economy.

In a report from CCN, it looks like Ripple hasn’t been entirely honest. Based on the statistics available through CoinMarketCap, the token of Ripple is the third-largest exchange by market capitalization, with over $701 million in volume in the last 24 hours. However, data from OpenMarketCap tells a different story.

OpenMarketCap is clear that they only source their information from crypto exchanges that stay away from wash trading and other bad activities. Their information says that XRP’s turnover at just under $82 million instead. If these statistics are accurate, that would mean that 93% of the volume reported on CoinMarketCap is completely fake.

Still, it is worth noting that Ripple is hardly the only guilty party, even among allegedly big exchanges. Litecoin reports that they have $2.9 billion reported, while only $106 million comes up as real. EOS is not innocent either, with only $121 million in real volume, compared to $2.9 billion reported. Bitcoin Cash, which went through a highly controversial hard fork last year, reports $1.6 billion in volume, but their actual volume is only $146 million. Right now, Bitcoin is the only real winner with all of this information exposed. With suspicious activity eliminated, their trading volume rose from 29% to 48%.

Yin Wu, the founder of the DIRT Protocol that produced OpenMarketCap, published a blog post recently to discuss why crypto exchanges report fake volume at all. He stated that these exchanges want to go up in the price tracker listings, which is possible through reporting higher volumes that they falsify, rather than naturally create.

Wu believes it is absolutely essential that users have access to trustworthy and secure data to make their decisions, which the key to the whole crypto ecosystem anyway.

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