Some cryptocurrencies exchanges operate suspiciously. This means that the market cannot be fully regulated. The new reports of harmful listing proposals from anonymous “top 30 exchange” suspects indicate that there is still much to be done against hype.
Roy Huang, co-founder of FRESCO, a network of Blockchain assets, has alleged that a suspected “top 30 exchange” in the ecosystem approached his project with a series of unethical, manipulative propositions regarding a potential list of FRES tokens.
Huang refused to give the name of the exchange with the indecent proposal. The proposal lists a number of avenues that the FRESCO project could take through the exchange in order to artificially cure the FRES token market cap.
Huang stated that the exchange literally proposed that
“our company to use trading bots to create fake volume with 0 transaction fees”.
Elsewhere in the document it says explicitly:
“If you want to create market cap management, we will provide API and let your engineering team to customize the trading bot for your project.”
In response to this industry problem, Huang concluded that the ecosystem needs a “self-regulatory organization” to help mitigate such activities. But, in a space where the free market economy and blockchain technology are widely appreciated, many will say on the other hand that such an organization would be redundant or prone to regulatory capture.
Still others will sympathize with Huang's desire to decisively address the market manipulators. In addition, if the proposal is indeed real, one cannot help but wonder what other projects took the mysterious exchange offer or similar offers from other companies in the past.
Is This Growing?
This year, several crypto exchanges have been involved in dramatically similar accusations. Sylvain Ribes, investor and trader, claims that OKEx and other popular Chinese exchanges are creating large amounts of fake trade volume.
In April, Verify (CRED) CEO Yazin Alirhayim presented his case for non manipulative but incredibly unprofessional behavior that the KuCoin exchange demonstrated towards his project over several weeks. The episode led Verify to cut links with KuCoin, losing a non-refundable 5-bitcoin fee in the process. Alirhayim even claimed that the exchange “offered us 0.5 BTC for not publishing” his comments.
Roy Huang has also recently called for excessive space listing fees, saying that even the NASDAQ charges less.
Some crypto exchanges in the market have acquired bad habits. With these facts, the arguments against the ecosystem and the legal problems of bitcoin in some countries could lead to adoption later as it could lead to a rougher fight than it has so far been.