Zurcoin Co-Founder says many exchanges are Manipulating Crypto Market
Daniel Mark Harrison, Zurcoin co-founder said the majority of crypto exchanges are actively engaged in manipulating digital asset markets, which threatens the long term stability of the market and fundamentally contradicts cryptocurrency’s principle of decentralization.
In a post published on Medium, Harrison stated that exchanges are effectively stealing from their customers by acting in ways that move crypto prices downward until customers simply abandon their holdings, enabling exchanges to increase their crypto asset holdings through the back door.
As Harrison would like to think, the market circumstance that indicates expanded volumes in the midst of lessened capitalisation is in a general sense incomprehensible as indicated by reasonable market conduct, and must be the aftereffect of control by trades with the point of picking up authority of client crypto reserves be abusing the brain research of retail financial specialists.
Refering to Bitcoin for instance, he clarified that in December 2017, Bitcoin’s volume was around $14 billion on market capitalization of $284 billion. By 2018, the volumes were held at $4.3 billion on a market capitalization of $59.9 billion, appearing while volumes remained at 4% of market capitalization in 2017, in spite of a 82 percent cost drop throughout the following a year, the volumes as a level of market top expanded to 9%.
As indicated by Harrison, it is difficult to clarify such a situation inside the setting of something besides purposeful descending value control by trades.
Explaining why this is possible, He said:
“The cause of this behaviour is clearly that running an exchange is by and large, an extremely cost-intensive, highly competitive, low-margin business, which holds next to appeal for entrepreneurs wishing to cash in on the new digital gold rush. Instead then, such entrepreneurs manufacture cryptocurrency volumes in the form of virtual currency trades represented uncolateralised on their exchanges, in the hope of obtaining (stealing) the majority of their customers’ cryptocurrency over time.”