China warns cryptocurrency exchanges are "counterfeiting volume"




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China National Internet Finance Association (NIFA), a self-regulatory organization set up by the People's Bank of China, has issued a warning to domestic investors that cryptocurrency exchanges outside are carrying out market manipulation activities.


According to an internal analysis was announced on Thursday, NIFA said cryptocurrency exchanges based outside of China are using “robotic programs to hide and forge data to create the illusion of excitement in the market. electronic money transactions ”.


The analysis results show that more than 40 cryptocurrency assets generate trading volumes in excess of 100% of their total market capitalization, while over 70 coins witness daily trading activity equal to more than 50% of the total. market capitalization of them.


Manipulation in the cryptocurrency market is a long-standing concern of many people. Last year, Bitwise said about 95% of Bitcoin's reported transaction volume was fake. The Block newspaper also conducted a separate study on this topic at the time and found that about 86% of the trading volume of the entire crypto market was reported to be fake.


Notably, NIFA also revealed that the operating entities of cryptocurrency exchanges are "relatively anonymous". Their development and sales offices are often different, and users cannot identify these operators.


In response to these concerns, NIFA advises investors not to engage in cryptocurrency trading activities.


Cryptocurrency exchanges have been banned in China since 2017, but as long as their headquarters are located outside of China and peer-to-peer (P2P) transactions, they can still do business at this country.


For example, the Binance exchange is currently offering P2P trading for Bitcoin (BTC), Ether (ETH) and Tether (USDT) with the Chinese yuan since October last year.


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According to The Block
Translated by ToiYeuBitcoin