OKEx acknowledges the problem of overvalued trading volumes
The representative of the OKEx cryptocurrency exchange admitted that not all transactions carried out through its trading platform may make economic sense, which in turn gives rise to the problem of overstated trading volumes.
Commenting on Bitwise’s recent report that 95% of bitcoin trading volumes are falsified, OKEx’s Financial Markets Director Lennix Lai said to Crypto Briefing, “We admit it.” At the same time, he noted that the problem is due to the behavior of the market, namely those of its participants who are trying to “trade cunningly” in order to get the most favorable conditions for themselves on commissions.
“There is a lot of suspicious trading activity on OKEx. We are working on many measures to prevent this kind of thing, “he added..
Asked if OKEx itself is trading to inflate transaction volumes, Lai, who follows “a fair, transparent and orderly marketplace,” according to his LinkedIn profile, said, “Of course not.”.
During a speech at one of the meetups, Lai explained that by making a large number of transactions in illiquid pairs, some traders quickly raise the level of their accounts on the exchange, after which they take advantage of reduced commissions. “It takes time to get the volume you need. One of the easiest ways is money laundering. In particular, this is the sin of Chinese traders, ”he said..
A particular difficulty for OKEx is the fact that the identification of accounts is carried out by clients only to increase the amount of funds available for withdrawal. Because of this, the company has no way of calculating traders who trade with themselves. To prevent such practices, OKEx recently increased the minimum bidding price spacing, making it “much more difficult” to raise account levels in this way. “If you are going to start money laundering, you have to spend a lot more resources,” added Lai..
Also this week, OKEx changed the structure of its fee collection, increasing the trading volume requirement for some levels by 10 times..
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