Research shows cryptocurrencies can fall substantially with small sell offs Earlier this month, cryptocurrency trader Sylvain Ribes investigated into the volumes of most small-scale cryptocurrencies and discovered that the trading volume of OKEx, the fourth largest cryptocurrency trading platform in the world, is mostly inflated. Ribes, who initially set out to conduct a study on the liquidity of cryptocurrencies and digital assets, utilized a method he named “slippage” to test the order book of each cryptocurrency trading pair.

The slippage method by tests the liquidity of digital assets by selling $50,000 worth of each asset across various exchanges. After selling $50,000 worth of a cryptocurrency, Ribes measured the rate of decline of that particular cryptocurrency on a certain exchange to measure its liquidity.

Ribes implemented this method to test the liquidity of cryptocurrencies on OKEx, Bitfinex, Kraken, and GDAX. Operated by OKCoin, formerly the largest cryptocurrency exchange in China prior to the local government’s crackdown on trading, Hong Kong-based OKEx briefly became the biggest cryptocurrency exchange internationally, as reported by Cointelegraph, overtaking Binance in March 2018.

At the time of reporting, OKEx remains among the four largest trading platforms, alongside Binance, Huobi, and Bitfinex. Bitfinex, Kraken, and GDAX are regulated cryptocurrency exchanges that allow cryptocurrency-to-fiat trading.

GDAX was founded and is currently being operated by Coinbase, which has more than 20 mln users and is the most widely utilized Bitcoin wallet. Kraken is based in San Francisco, while Bitfinex is based in Hong Kong, alongside OKEx and Huobi. Read more from…

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