Bitbns, one of India’s largest crypto exchanges, has been caught manipulating Bitcoin (BTC) and Ripple (XRP) volumes by over 500 percent.
A research by Crypto enthusiast Karthik Varma revealed that trade volumes of BTC and XRP have been exaggerated by more than 500 percent and 668 percent respectively. The exchange may have attempted to inflate volumes in a desperate attempt to improve their ranking. A major cryptocurrency tracking site CoinMarketCap usually filters out exchanges that do not meet a certain volume threshold. For this reason, exchanges have been cheating its statistical algorithms to rank higher.
After the price of Bitcoin (BTC) reached a new all-time high of close to $20,000 and reaching a market value of more than $830 billion toward the end of 2017, Bitbns maintained a fairly small but stable volume. However, by the end of March this year, experts found out that Bitbns’ trade volume was questionably higher than that of its rivals. This raised concerns and led to speculation about how it was possible for the company to significantly increase its trade volume.
Abnormally high BTC and XRP trading volumes
After detecting a series of unusually high volumes, Varma started investigating the exchange. He deployed a system to record the trade history of BTC and Ripple (XRP) transaction on the platform. He aggregated and compared the data to the value listed by the exchange. Varma observed major inconsistencies. He said the following:
“The recorded data showed the trade volume of XRP over the 24-hours interval as 62,365 and that of Bitcoin as 2.638. But on the Bitbns website, the trade volume for XRP was shown as 375,410 almost 500% more than the actual volume, and that of Bitcoin was shown as 20.266, almost 668% more than the actual traded volume.”
For now, it is impossible to crack down on the exchange as there are no regulatory bodies controlling the crypto market in India. The discovery has led many crypto enthusiasts to question the credibility of other crypto exchanges as well.