Bitcoin: An unregulated market is a good place for price support breathing

cryptocurrencies always earned skepticism. The collapse of the FTX platform group - and a stopping the withdrawals at Genesis Trading - means that you need an even sharper test. The most important candidate is Bitcoin's price. The volatility of the flagship of the digital assets was amazingly reserved in view of the recent events.

Bitcoin is traded at just under $ 16,500, about a fifth lower than a few weeks ago. Surely it should have fallen? It is a key factor in the incestation intertwined shops in the crypto industry.

Conspiracy theorists who remember Libor interest manipulation naturally ask themselves the next question: Are the listed prices correct? The answer is yes and no. Screen prices are usually composed values, which are compiled from inputs, which are provided by several exchanges.

Theoretically, all Bitcoin transactions are logged transparently in the blockchain. This contributed to the fall of FTX. Internet detectives recognized that the stock exchange funded customer withdrawals from their Alameda trade branch.

The activities on the stock exchange must not be recorded publicly. Many shops include transfers between customers within a single wallet of a stock exchange. That could cloud the pricing significantly.

disreputable traders now have scope to operate "Wash" trading. This includes that owners sell assets with various wallets. This could give the impression that the prices are higher and the liquidity is more abundant than is actually the case.

It is estimated that washing transactions make up to 90 percent of the volume. Scruply crypto transactions could possibly offer fake liquidity to win new customers. A study by the Blockchain Research Lab, a non-profit organization based in Germany, showed that some outlier exchanges reported a 134-time volume than a control group.

This year two trends have occurred in purchase activity. On the one hand, the proportion of long -time owners is growing steadily. Second, the trading volume for wallets reached an all -time high with a Bitcoin or less in early November.

This could reflect a newly gained trust under an army of small investors or be a clever attempt by some great investors to simulate this phenomenon.

The Lex team is interested in hearing more from the readers. Please let us know in the comment area below what you think of the disclosure of the Bitcoin price.