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Bitfinex: So-called “fake volume” is on CoinMarketCap’s end, not ours

Posted: 25 October 2018 7:04 pm

You can't believe everything you read. Except that.

Bitfinex bashing is one of the cryptocurrency world's favourite pastimes, perhaps partly because it makes it easy.

But people might have gotten a bit carried away on this occasion.

Fake news, not fake volume

A piece published in CoinDesk pointed out that CoinMarketCap was showing a lot of volume for a USDT/USD pair.

"If there's no USDT/USD trading on Bitfinex, then, why does the pair appear on CoinMarketCap – easily the most-visited aggregator of cryptocurrency data, according to Amazon's Alexa rankings?" it asked. "The question is more than an academic curiosity, given that Bitfinex shares common owners and managers with Tether Ltd., the entity that issues USDT, and that the stablecoin is under increased scrutiny since losing its parity with the dollar more than a week ago."

A spokesperson for CoinMarketCap said the data came from Bitfinex's own API which feeds data to outside applications.

Bitfinex responded to the news on Twitter in a mildly peeved way, saying that the API being used by CoinMarketCap shows the sum of USDT deposits and withdrawals, not trading volume.

"We are not ‘publishing’ fake numbers; the API method is called ‘movement_volume’ and isn't part of our ticker API. Not pushed by us, pulled by CMC. Another not-so-brilliant example of anti Bitfinex/Tether FUD," it said.

CoinDesk did Bitfinex the courtesy of responding on Twitter, saying, "CoinDesk reached out multiple times for clarification on this data point yesterday, as did CoinMarketCap. We held off for hours in hopes of receiving clarity for our report."

It didn't remove the now somewhat paranoid-looking piece, but did add the additional commentary it received from Bitfinex. To wit:

"We do not have a direct USD/USDT pair on Bitfinex so I believe it represents deposits/withdrawals of some kind."

"CoinMarketCap displaying a pair does not equate to Bitfinex publicising data that doesn't exist. CoinMarketCap track our API's and them displaying this pair is not something which we have control over, nor is it something we have pushed for." CoinMarketCap has since reached out to Bitfinex to help clear up the error.

So if you saw some strange goings-on relating to Bitfinex volumes on CoinMarketCap, that was apparently on CMC's end.

If nothing else, the incident shows the frictions emerging in the cryptocurrency space and how ready people are to dive into even a hint of suspicious behaviour on the part of Tether and Bitfinex. Bash responsibly.

Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VET, XLM, BTC, ADA

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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