Bitcoin Price Analysis: Wash Trading & Rising Volume

In recent weeks there has been noticeably more volume on two of the major bitcoin exchanges: Bitstamp OKcoin. The two charts below show the big increase in volume with very little price movement on both of these exchanges.

After speaking with self proclaimed “degenerate gambler” and one of the most respected bitcoin traders of the space, BTCVIX, most of this volume appears to be wash trading. “And now we are even seeing some of this interest wane as I believe the ramping up volume washing bot activity is the Casino trying to keep the lights flashing and the sounds blasting so that we keep wanting to play the game,”  according to BTCVIX. More can be found on this subject:

This is done to fake liquidity and volume. What happens is large orders are bought and sold of almost the same amount very quickly. This increases churn but affects price very little. Below are some charts showing what is considered to be wash trading.

Bitcoin has been stuck in a very tight range (under US$20) since the beginning of September. While this column has commented for months

Read more ... source: Cointelegraph