Monday, January 21, 2019

DEXs Net 1% 🤨

January 21, 2019

DEXs are Gaining Traction But Their Impact Is Still Small

Decentralized exchanges (DEX), a place where buyers and sellers are matched without the help of a central authority, burst onto the scene in 2018.

Teams jumped at the idea of distributing power from central authorities like Binance and Coinbase, and giving control back to the traders.

However, though more than 50+ DEXs have hit the market, they still have only gained less than 1% of the trading volume on centralized exchanges, according to research firm TokenInsight.

Started off strong

That metric only shows part of the story, though. Actually, DEXs have grown up quite a bit in the last year.

Volumes on DEXs boomed in the first quarter of 2018 by more than 195% as the industry started to recognizing the security risks of holding assets on a centralized exchange.

Can't beat the bear

But that growth couldn't outpace the impact of the bear market. In the third quarter, volumes began sinking and DEXs saw a stronger downturn than centralized exchanges did.

The future is decentralized

It's a common belief in crypto that the future is decentralized. DEXs have made trading without the risk of sending crypto to a third party possible, but they haven't found a way to make a big splash just yet.

While it's still early in many DEX lives, it's clear they have some work to do if they want to find the volume numbers centralized exchanges are pulling.

OPINION

Lack of ETNs Reason Wall Street is Absent from Crypto, Says CBOE CEO

CEO, president and chairman of the Chicago Board Options Exchange, Ed Tilly, recently stated that he believes that the lack of exchange-traded notes (ETNs) is limiting Wall Street's involvement in crypto.

Due to regulatory and compliance reasons, investment firms are not able to directly purchase crypto, rather they must rely on financial instruments that track their price. However, there is an extremely limited amount of these exchange-traded products.

Tilly explained the benefits of ETNs over futures:

"The power of having that future there is also having an ETN that is more attractive to retail, and then institutions can lay that risk off on the listed futures market. [...] Absent that leg and introducing trackers or notes, I think we will be in this, 'It trades every day, but it is not the story.'"

Countdown to ETF decision

The SEC has previously stated that that the custody and price manipulation issues need to be figured out before an ETF will be approved.

A decision will be made on the appeal of the last batch of denies ETFs by February 27th, 2019. On that date, according to the SEC rules, the commission must make a decision to approve or deny - it can't be delayed again.

NEWS

Exchange Executives Arrested for Faking Trading Volume in Korea

Two executives of the South Korean cryptocurrency exchange Komid will serve jail time for faking exchange trading volume.

Komid's CEO, was served a three-year sentence. Another executive at the exchange was sentenced to two years for fraud, embezzlement, and misconduct.

The arrested executives reportedly faked 5 million transactions, as a result, the two profited $45 million.

The motivation behind the fraudulent actions of the exchange leaders was to create the perception that Komid is a popular exchange and to attract customers.

Komid's not alone

A recent report released by Blockchain Transparency Institute (BTI) claimed that over 80% of trading volume in the top 25 Bitcoin pairs on CoinMarketCap is faked by wash trading - a process in which a trader boosts volumes by both buying and selling an asset.

The conclusion stems from 3-months of surveillance on top crypto exchanges to watch for trading patterns as well as consultation from market maker experts.

According to the study, within the top 25, only two different exchanges stayed true to their real volumes: Binance and Bitfinex. That means even high-profile exchanges like OKEx, Huobi, and HitBTC are joining in on the fraud.

BITS

But wait, there's more...

💰 SBI Holdings invests $15 million in crypto wallet card maker Tangem.
🛑 Privacy-focused cryptocurrency Beam has experienced a blockchain stoppage after a shaky launch.
🏛 Chilean taxpayers must report all their cryptocurrency profits to the Chilean IRS.

MEME