50% Of Bitcoin Trading Are Fake
The cryptocurrency space is dominated by Bitcoin and remains as the flagship digital asset, accounting for 40% of the $1 trillion global market capitalization of all digital assets. However, the widespread practice of wash trading, which is a kind of phony or fake volume, and the lack of adequate oversight across crypto exchanges are two of the most prevalent criticisms leveled against Bitcoin.
According to a Forbes analysis of 157 crypto exchanges and trading platforms, more than half (51%) of all reported trading volume is likely to be fake or non-economic. Bitcoin represents 40% of the $1 trillion global crypto market.
As per Forbes, there is no universally accepted method of calculating bitcoin daily volume, even among the industry’s most reputable research firms. For instance, CoinMarketCap puts the latest 24-hour trading of bitcoin at $32 billion, CoinGecko at $27 billion, Nomics at $57 billion and Messari at $5 billion.
According to the report, there is no genuine method of calculating bitcoin daily volume, even among the industry's most reputable research firms. In terms of how much Bitcoin activity takes place, 21 crypto exchanges generate $1 billion or more in daily trading activity, while the next 33 exchanges had volume between $200 million and $999 million.
The biggest problem areas regarding fake volume are firms that tout big volume but operate with little or no regulatory oversight that would make their figures more credible, notably Binance, MEXC Global and Bybit. Altogether, the lesser regulated exchanges in the study account for approximately $89 billion of the true volume.
The creation of new trading assets and products such as stablecoins and perpetual futures adds complications for national authorities seeking to regulate crypto markets. Major U.S. exchanges hardly utilize these instruments or contracts in any of their trading. However, offshore exchanges make significant use of them as ways to synthetically create U.S. dollar liquidity on their platforms.
Binance is the leader with a 27 per cent market share, followed by FTX. Chicago-based CME Group is the market leader in bitcoin futures trading. After showing some stabilisation in the last few weeks, world's largest cryptocurrency Bitcoin has plunged once again below $20,000 after Federal Reserve Chair Jerome Powell's keynote address
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