CryptoCompare launches Exchange benchmark in response to concerns about error reporting

Crypto data provider CryptoCompare, based in London, has introduced an Exchange Benchmark product with more than 100 crypto spot fairs worldwide. The news was revealed in a press release that was shared with Cointelegraph on 12 June.

According to CryptoCompare, the new product was launched in response to the growing concern of the industry through research showing that a large number of crypto exchanges worldwide use wash trading and other strategies – including spoofing and inspired trade arrangements – to artificially increase trade volumes.

The press release outlines:

"The problem got worse with inferior quality exchanges (ranked C-F) which increased market share by 30% in the last 12 months, demonstrating the need for a ranking method that is not dependent on aggregated volumes."

To address this problem and to provide a more reliable understanding of barter volumes, CryptoCompare has designed its Exchange Benchmark with both a qualitative (due diligence) and quantitative ("market quality based on order book and trade data") approach, the press release.

Instead of relying on aggregated volume data, the benchmark reportedly uses "correlation-from-volume-to-volatility and standard deviation-from-volume" as input for more than thirty metrics.

Based on the measurement data from the benchmark for analyzing data for the month of May 2019, CryptoCompare reveals that it considers the ten most trusted exchanges worldwide (in the correct order): Coinbase, Poloniex, Bitstamp, bitFlyer, Liquid, itBit, Kraken, Binance, Gemini and Bithumb.

The press release notes that the benchmark will be used in the aggregated indices of CryptoCompare to determine reference interest rates for exchanges on the upper tiers in an effort to provide investors and traders with a high-integrity data set. Along with the product, a more detailed understanding of the company's exchange benchmark methodology has been released by the CryptoCompare research unit.

As reported, an analysis by Bitwise Asset Management of crypto-index fund – filed in March with the United States Securities and Exchange Commission – claimed that 95% of the volume on unregulated transactions appears to be fake or non-economic in nature.

Bitswise & # 39; s analysis echoed a large number of earlier analyzes that confirmed the prevalence of misleading reporting of trade volumes in the sector.

CryptoCompare yesterday unveiled a collaboration with Nasdaq to release a new cryptocurrency pricing product aimed at institutional investors, following the recent announcement of a joint venture with BitMEX to jointly build a real-time crypto-futures dataset.

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