The Role Of Trading Volume In Market Manipulation

The dark side of the cryptocurrency: how the commercial volume for market manipulation can be used

Cryptocurrencies However, despite their potential, cryptocurrencies are not exempt from risks. One of the most significant risks is market manipulation, which can be consequences of extreme reach requirement for investors and the entire financial system.

** What is market manipulation?

Market manipulation refers to any action this

The role of commercial volume

The negotiation volume is one of the key indicators used by merchants and investors to give feeling and liquidity in the market. When the negotiation volume increases rapidly, it often indicates a strong offer, where buyers and sellers are willing to trade at different prices. However, in the context of cryptocurrency markets, high negotiation volumes can also be used as a manipulation sign.

How can commercial volume be used for market handling

There are several ways in which the high volume of negotiation can be explained for market handling:

• This can increase prices and make genuine investors buy or sell their assets.

• This can create a false narrative that drives price movements, even if there is no real underlying reason for change.

• Manipulating supply and demand : By increasing or decreasing the volume of artificially negotiation, it is possible to manipulate the offer of a particular cryptocurrency or the perceived value of an asset.

Examples of market manipulation in cryptocurrency markets

• As a result, prices rose rapidly, reaching unsustainable levels.

2.

. According to reports, the trick was used to create a false ICO for a new cryptocurrency, which was then pumped by a high commercial volume.

The consequences of market manipulation

Market manipulation can have extreme requirement consequences for investors and the entire financial system. Some of the potential risks include:

• Systemic risk

  

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• Financial losses : Investors buying or selling assets

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Conclusion

The cryptocurrency markets are still in their early stages of development, and market manipulation remains and a significant risk.

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