While some political and corporate leaders have been eager to invest in and adopt cryptocurrencies, others are entirely hostile. Turkish President Tayyip Erdogan recently declared outright war on the Bitcoin network. President Erdoğan: "We Are At War" President Erdoğan expressed his opposition to Bitcoin in a meeting with Turkish students this Saturday. The event comes after one of them asked if the country's central bank would adopt cryptocurrencies. Erdogan responded with total rejection: "We have absolutely no intention of embracing cryptocurrencies. On the…
Recently, a renowned Chinese financial watchdog, the National Internet Finance Association of China (NIFA), warned against the increasing cryptocurrency investment risks. Its data analysis reveals that overseas crypto trading platforms usually fake trading volumes. Additionally, some trading platforms compare digital currencies to safe-haven assets like gold.
The association also did a sampling analysis on trading data on some crypto exchanges and found out that the daily trading turnover rate for over 40 coins exceeds 100%. However, the daily turnover rate for over 70 days exceeds 50%. NIFA also claims that there are higher trading volumes on the exchanges despite the relatively low price and small market value.
NIFA Explains How Crypto Exchanges Encroach Investors’ Funds
NIFA believes that the exchanges make false conceptions in the crypto trading market through forging statistics and using bots to increase trading volumes. The watchdog also added that some platforms fake trading volumes by completely copying information on other platforms.
The crypto exchanges then lure investors into the crypto market using various manipulation methods to encroach the investors’ funds. NIFA says one means that crypto exchanges encroach users’ funds is to stagnate transactions suddenly through downtime, unplugging cables, and freezing assets, among others. The watchdog said this could cause users to suffer heavy losses since they cannot actively close their positions and cause liquidation. However, NIFA says it cannot track most of these crypto exchanges since they are not China-based.