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CoinGecko launches ‘Trust Score’ to combat the false volumes of cryptocurrencies

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Since many cryptocurrency exchanges misreport many metrics, the data aggregator CoinGecko has decided to put an end to this matter and has announced through its official blog this May 13, the ‘confidence index' to report trading volumes. with a healthier approach that includes web traffic data and order books.

Although, as he said at the outset, traditional markets with high volume are highly liquid, the company is quite clear that this is not always the rule in the case of cryptographic exchanges and this is largely due to the lack of regulation that allows these exchange to inflate the volume of operations for unscrupulous purposes.

CoinGecko has already shown in the past to clean up the information in this regard, so that the data shown is as reliable as possible to make appropriate decisions based on tangible and accurate information.

The new rating algorithm called ‘Trust Score' on the company's website was universally implemented in the Exchange Summary and Currency pages as of this Monday, May 13, 2019.

Trust Score is a combined formula that takes into account the volume of operations, web traffic and depth of the order list of exchanges.

Bobby Ong, co-founder of the crypto market aggregator, said the ‘confidence score' will point to ‘combating false volume data in exchanges'.

The publication makes an equivalence of the volumes presented by five popular exchanges such as ZBG, OKEx, Dobitrade, ZB and FCoin, which according to information of these same, occupy the first five places of Volume of operations as reported.

However, CoinGecko when normalizing these volumes according to their algorithm, none of the aforementioned appear in the top 5.

On the other hand, the firm indicates that the normalization of the exchange volumes are added through web traffic by third-party services such as SimilarWeb, which they say is more difficult for exchanges to falsify these volumes.

Regarding the analysis of order books, the site indicates that the new metric to estimate it will be the Bid / Ask Spread and the + / -2% of depth cost, which is based on the capital of USD required to move the book of orders by 2% in any direction.

The intention, they say, is that these metrics combined with the volume of trading data, provides a better overview of the actual liquidity of any pair of trades in an exchange.

On the other hand, the Average Daily Volume of Operations of the User [ADUTV] will be calculated based on the average of 10 exchanges, based on the Bitwise File Management report presented to the SEC.

According to Bitwise, 95% of the exchanges falsify their volume, with the exception of ten exchanges, which CoinGecko is using to calculate its ADUTV.

CoinGecko states that its confidence score algorithm makes it clear that higher volume does not necessarily equate to a healthier order book. Therefore, your ‘Trust Score' is divided into three categories: good (green), regular (orange) and poor (red).

For a future the company has made it clear that it will introduce more metrics to its confidence index to improve its robustness.

Recently, Bitfinex was involved in an $ 850 million cover-up scandal that exposed the false volumes and its inflated price of notable advantage over other exchanges over BTC's price generated great disbelief about the giant exchange's reports.

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Ethereum Network Is Getting Closer To 1 Million Transactions A Day

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  • Ethereum transactions are close to 1 million per day
  • The whole network is recovering from last years’ bear market

The Ethereum (ETH) network seems to be performing very well in terms of the number of transactions that it’s currently processing. The second largest blockchain platform in the market is approaching 1 million transactions per day, according to data provided by BitInfoCharts.

Ethereum Transactions Reach New Highs

As the crypto market expands and the community changes the sentiment to positive, blockchain networks are becoming more used than before. This can be seen in Bitcoin and Ethereum. The second largest cryptocurrency has reached almost 950,000 transactions a few days ago, and the trend is clearly to the upward. However, this remains far from the 1.35 million transactions that the network registered in January 2018.

At the same time, Bitcoin transactions are reaching new highs in over a year. A few weeks ago, Bitcoin registered 452,000 transactions. However, there is a difference between Bitcoin and Ethereum. While Bitcoin transactions reached a bottom in April 2018, Ethereum network activity continued falling until almost a year later in February 2019.

Since February, the number of transactions on the Ethereum network grew by 150%. This is the same level as in February 2018 with the exception of a sudden peak in May 2018. Since February, Bitcoin transactions grew by 35%.

Ethereum is also recovering after falling below $100. This sharp decline in the price of Ethereum was related to the fact that there were several startups and Initial Coin Offerings (ICOs) selling their digital assets in order to cover operational costs. At the same time, this drop was accompanied by a price decrease in Bitcoin (BTC).

One of the fastest growing sectors of the Ethereum ecosystem is Decentralized Finance (DeFi), which consists of Ethereum-based peer-to-peer lending products such as MakerDAO or Dharma, among others.

At the time of writing this article, Ethereum is being traded around $257 and it has a market capitalization of $27.37 billion. In the last 24 hours, Ethereum lost almost 10 percent of its value due to a large drop in the price of digital assets.

Ethereum seems to be recovering from the bear market in economic terms. Its network could be processing 1 million transactions a day in the near future. This is the same value as the network registered in February 2018.

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Bitcoin Cash gets 51% Attacked by Just Two Miners to Reverse Transaction, Price is Unchanged

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  • Btc.com and BTC.top carries out a 51% attack on Bitcoin Cash network to stop an unknown miner
  • BTC price down less than one percent only

Two of the Bitcoin Cash miners reportedly carried out a 51% attack on the Bitcoin Cash (BCH) blockchain in an effort to reverse another miner’s transactions, per the Tweet by Cryptoconomy Podcast host, Guy Swann on May 24th.

A 51% attack occurs when someone controls the majority of the mining power on a Proof-of-Work (PoW) blockchain network. This means the majority of the block verifiers can prevent others from mining and reverse transactions.

Controlling 50 percent of the Hash Power

Typically, it has been assumed that a 51 percent attack is carried out with malicious intent, however, this isn’t the case with Bitcoin Cash. Here, two mining pools – BTC.com and BTC.top carried out this move to stop an unknown miner from taking some coins, due to a code update. Instead of rewarding the attackers or have them for themselves, this move was for the good of the community.

Swann explained, “Since the original split in 2017, there has been a significant number of coins accidentally sent to ‘anyone can spend’ addresses (due to [transaction] compatibility of signs, but no #SegWit on #BCH), or possibly they’ve been replayed from #Bitcoin onto the #BCH network.”

The attacker that day took advantage of a bug that was unrelated to the upgrade – which was subsequently patched – that caused the Bitcoin Cash network to split and BTC.top to mine empty blocks while the bad transactions made blocks impossible to produce.

“When the unknown miner tried to take the coins themselves, [BTC.top and BTC.com] saw & immediately decided to re-organize and remove these [transactions], in favor of their own [transactions], spending the same P2SH coins, [and] many others,” Swann further said.

At one point, BTC.top controlled over 50 percent of the power by itself. However, BTC.com and BTC.top were able to join together in order to reverse the blocks of transactions. Currently, both the mining pools have a combined hash power of more than 42 percent, as per the data provided by Coin Dance.

A Good or Bad Thing?

The Bitcoin Cash community is divided on this. While some developers are quiet, others like jtoomim called it “justice” and “punishment” for “antisocial behaviour.”

Meanwhile, some like Bitcoin Cash developer that goes by the name, Kiarahpromises argues that it is bad for the blockchain and shows that BCH blockchain is centralized.

“To coordinate a reorg to revert unknown’s transactions. This is a 51% attack. The absolutely worst attack possible. It’s there in the whitepaper. What about (miner and developer) decentralized and uncensorable cash? Only when convenient?” said  Kiarahpromises.

https://twitter.com/WhalePanda/status/1131979967858905088

This is certainly a matter of concern shared across proof-of-work networks. If we take a look at the bitcoin’s hashing power, according to Blockahin.com, it is divided among three mining pools only.

Currently, this attack has no effect on the price of BCH/USD as it trades at $414 with 24-hours loss of a mere 0.65 percent. BCH is up 161 percent till date, in 2019.

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Bitcoin SV Price Analysis: BSV Rally Could Extend Above $125

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Bitcoin SV Price Analysis BSV Chart

After Craig Wright’s drama, there was a strong rally in bitcoin SV price above $80.00 and $100.00. BSV to USD even traded towards the $135.00 level and it is currently consolidating gains for the next wave.

Key Takeaways: BSV/USD

  • Bitcoin SV price surged above $100.00 and doubled in value against the US Dollar.
  • BSV/USD is currently trading inside a contracting triangle with support near $98.00 on the 2-hours chart (data feed from Bitfinex).
  • Bitcoin price is down around 1% to $7,800 and ripple price is struggling below the $0.4000 barrier.

Bitcoin SV Price Analysis

Recently, Craig Wright filed registrations with the U.S. Copyright Office to claim authorship over the original bitcoin code and the Satoshi white paper. It sparked a sharp upward move in bitcoin SV price from the $60.00 support area.

Looking at the 2-hours chart, bitcoin SV climbed higher significantly and broke many resistances such as $80.00, $85.00 and even $100.00. There was a close above the $100.00 level and the 50 simple moving average (2-hours, purple).

Bitcoin SV Price Analysis BSV Chart

BSV price rallied above the $125.00 level and traded as high as $134.82. Recently, it started a downside correction and traded below the $120.00 level and the 23.6% Fib retracement level of the recent rally from $61.64 to $134.82.

However, the $100.00 level along with the 50% Fib retracement level of the recent rally from $61.64 to $134.82 are currently acting as a support. Moreover, the price is trading inside a contracting triangle with support near $98.00 on the same chart.

If there is a downside break below the $100.00 and $98.00 levels, the price could extend the correction towards the $88.00 level or the 61.8% Fib retracement level of the recent rally from $61.64 to $134.82.

On the other hand, bitcoin SV could start a fresh increase above the $105.00 and $110.00 levels. However, a successful close above the $120.00 level is needed for a strong rally in BSV in the near term.

The next key resistance is near the $135.00 level, above which bitcoin SV might climb towards the $150.00 barrier. On the downside, the main supports are near $98.00, $88.00 and $82.00.

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