The role of trading volume in manipulation on the market: unpacking landscapes of cryptocurrencies

The Role of Trading

In the world of cryptocurrencies, market manipulation has become burning. Although blockchain technology and decentralized networks provide levels of security and transparency, malicious actors found ways to use them to influence markets and involve illegal activities. One key aspect that is often overlooked is volume trading – a clean number of transactions that participants have performed on exchange or platform. In this article, we will explore the role of trade volume in market manipulation and explore its consequences on investors.

Anatomy of market manipulation

Market manipulation involves artificial influence on prices movement to create the desired outcome. This can be achieved by different means, including the spread of false data, creating pump schemes and landfills, or simply manipulating market feelings. In the Crypto currencies, which are mostly unregulated, market manipulation especially refers to their decentralized nature.

Role of trading volume

Trading scope refers to the total number of transactions made on exchanges or platforms in a specific time frame. It is a critical metric that investors and traders use to assess market activities, liquidity and feelings. However, when it comes to manipulation on the market, trading volume plays a complex role.

On the one hand, high trading amounts can be viewed as a positive indicator for several reasons:

On the other hand, a large amount of trading also causes concern about manipulation:

Dark Side of High Trade Volume

High trading volume is associated with several cases of market manipulation including:

Mitigation of market manipulations

For the fight against manipulations on cryptocurrencies, regulators and exchanges have implemented different measures:

Conclusion

The role of trading volumes in market manipulation is complex and multiple. Although high quantities can be viewed as a positive indicator, they also cause concern about artificial reinforcement, infection with liquidity and price suppression. To relieve these risks, exchange and regulators must give priority of transparency, supervision and effective monitoring mechanisms.

UTILIZE UTILIZE TRADING PSYCHOLOGY

Leave a Reply

Your email address will not be published. Required fields are marked *