Crypto Data Provided By Individual Exchanges Appears Inconsistent

Crytpo and Bitcoin Market Cap Story of Day

Crytpo and Bitcoin Market Cap Story of Day





Since The Launch Of Several New Futures Platforms, Data Provided By Individual Exchanges Appears Inconsistent - While There Is Little Way To Prove Wash-Trading Or Misreporting Volumes, There Is Evidence That Such Practices Could Be At Work

Since their launches in mid-2019 XBT, BTC settled-futures hosted by Asian-based OKEx and Huobi have climbed to consistently the top 2 most active platforms as reported by (which pulls self-reported statistics). According to the metrics, the platforms have surpassed BitMEX in daily volume traded which, at the beginning of the year, was the undisputed leader in such products. That said, while #3 in daily volume, BitMEX remains by far the leader in contract open-interest which at a glance, seems contradictory. Notably, both OKEx and Huobi have reputations for falsifying spot-volumes. In their latest report, for example, the Blockchain Transparency Institute identifies Huobi as wash trading over 50% of their volume and OKEx at over 70%.

Crypto Takeaway: Even without making any major pronouncements, it is odd that OKEx, for example, would have daily volume consistently ~1.5x larger but have open interest about 60% that of BitMEX. The two most likely explanations that we can come up with are either that OKEx clients are trading in a different way or that there is indeed wash trading (and we cannot find any reason to suggest why OKEx/Huobi clients would trade uniquely). Further supporting the wash trading argument is that, though the platforms launched in a similar timeframe, OKEx and Huobi are both reporting much higher daily volume than Binance in spite of the latter being the far more active spot platform. Ultimately, proving wash trading, especially as an outsider, is a difficult task. One can at least say, however, that without some kind of explanation, discrepancies in open interest versus volume appear inconsistent.

About the Author

FRNT Financial is a technology and sales layer that offers institutional and accredited investors access to various forms of exposure to crypto-assets.