Binance CEO Changpeng Zhao (CZ) has recently spoken on a very interesting subject.
He addressed the reason for which some Bitcoin and crypto exchanges are faking volume.
95% volume on unregulated exchanges is fake
The Daily Hodl reports that crypto index and beta fund provider Bitwise has recently released a mindblowing report.
This states that 95% of volume on unregulated crypto exchanges is fake.
Bitwise is expecting approval for a Bitcoin exchange-traded fund and has submitted this report to the US SEC.
Bitwise says that the vast majority of reported crypto exchange volume is “fake and/or non-economic in nature… the real market for bitcoin is significantly smaller, more orderly, and more regulated than commonly understood.”
They also write that only ten exchanges have actual volume from the 81 top exchanges.
Zhao explains what’s happening
CZ says that such exchanges are faking the trading volume in order to get a high standing on CoinMarektCap which crypto enthusiasts already know is the platform which maintains a public ranking of all crypto exchanges by volume.
Why do exchanges fake volumes? @CoinMarketCap is highest traffic website in our space, and biggest referrer for all exchanges. Ranked high on CMC has benefits for getting new users. BUT at the expense of DESTROYING CREDIBILITY with pro users. Many forget the later part. https://t.co/XTSez5ZRVh
— CZ Binance (@cz_binance) March 19, 2019
Of course, higher exposure on CMC triggers business and traffic as well.
According to CZ, CMC brings more referral traffic to Binance for instance compared to any other websites.
CMC is definitely the biggest website in the crypto space and it’s ranked as the 448th biggest one in the world.
CZ praises XRP, says it’s not a security
In other news, CZ has recently praised XRP and said that the coin is not a security, at least until it’s proven otherwise.
One of the most exciting subjects was XRP as well. You can find the complete transcript of what CZ had to say on Binance’s blog.