CoinMarketCap changes the metric to identify the exchanges that inflate the trading volumes

CoinMarketCap changes the metric to identify exchanges that inflate trading volumes - coinmarketcapOne month after Binance purchased CoinMarketCap for $ 400 million, the crypto price comparison site has unveiled a exchange rate classification system that offers its new owner the best possible score thanks in part. , to the CEO Twitter feed.

Web traffic is a fundamental part of the new metric

CoinMarketCap new owner Changpeng "CZ" Zhao, tweeting the news on Thursday, said he reacted to the concern expressed by many traders for exchanges that artificially inflate volumes so that they seem more important, a practice known as wash trading.

"Now I can finally get a clear view of the field and see who the real emerging exchanges are, lol." The new CoinMarketCap metric focuses on web traffic.

In a post this week, the site - which received nearly 29 million hits in April - argued that parameters including the number of pageviews, time spent on the site and bounce rate are a "good approximation. intermediate "to determine how much activity of an exchange is truly human.

Binance comes first

Perhaps coincidentally, the new metric has been applied to Binance which has achieved a perfect web score of 1.000 out of 1.000. This means that CoinMarketCap believes that the activity on Binance is 100% human. In comparison, rivals Coinbase Pro and Kraken achieved a web score of 972 and 856, respectively.

"This exchange ranking is much more usable now," Zhao said in a tweet, adding that they will try to refine it better in the future. The CoinMarketCap post states that the site is also planning a new algorithm that will use the liquidity and depth of the order book to better detect the disparities between actual and reported volumes.

CoinMarketCap was previously opposed to the idea of ​​using web traffic for positioning. Strategy chief executive Carylyne Chan said in a podcast late last year, when he was still an independent company, that web traffic "was not a good indicator" as many traders use API keys, which obfuscate the data. collected.

Chan, who is now CEO of CoinMarketCap, said on Twitter Friday that web traffic is "only * one of the many factors * that will make up the final algorithm".

Does Binance want to "manipulate the rankings"?

However, some cryptocurrency traders are not happy with the change. Mati Greenspan, founder of Quantum Economics, tweeted last Friday that Binance had "abused" the acquisition of CoinMarketCap "to manipulate the charts".

Sam Bankman-Fried, founder and CEO of FTX Exchange, which received a investment not disclosed by Binance, said the new web traffic score "leaves something to be desired."

Zhao said Binance expressed plans to keep CoinMarketCap independent last week. Speaking at the recent ether summit, he said that the money spent on acquiring the exchange indicates that Binance is working to protect its neutrality.