Sylvain Ribes has published a study that reveals information about trade volumes of exchanges like Okcoin (Okex) and Huobi, which may be falsifying their trade volumes. Ribes wanted to “measure how badly market selling $50k USD worth of each cryptocurrency would crash the price.”
“I found ridiculously massive discrepancies between exchanges. Not the kind that can be easily hand-waved away (“oh well, their users must behave differently”), but the kind that can only be explained by some figures being overstated as much as 95%,” explains Ribes’ study.”Leading the pack is Okex, currently ranked #1 exchange by volume with $1.7b total volume on both Coinmarketcap and Livecoinwatch websites.”
Okex volumes raised a red flag for Ribes who says because the markets are unregulated artificial volumes and wash trading should be expected. Ribes’ slippage and volume chart indicate that the pairs with a daily volume of $100K across four exchanges over 24 hours.
“Many pairs, albeit boasting up to $5 million volumes, would cost you more than 10% in slippage, should you want to liquidate a mere $50k in assets — Those pairs included, at the time of the data parsing (06/03/18): NEO/BTC, IOTA/USD, QTUM/USD — Hardly illiquid or low-profile assets,” Ribes states.
“Although those numbers alone prove to me without the shadow of a doubt that a suffocating majority of Okex volume is fake, I had not witnessed first-hand how they implemented it — I thus logged into their platform and had a look at some pairs trading history. And indeed, they fake their volume in a laughingly obvious and artificial way. “