Bots are increasingly manipulated exchange rates of cryptocurrencies. Should you be afraid of?

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2018-10-03 21:15:07

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Bots are increasingly manipulated exchange rates of cryptocurrencies. Should you be afraid of? Source:

In cryptocurrency market are many scams. Participants with varying degrees of success trying to get unscrupulous players, but this time the blow came from where did not wait. It turned out that along with the crooks of large funds use bots and automated trading system for the manipulation of the exchange rate of Bitcoin.

Automated trading systems — a common phenomenon for both cryptocurrency and traditional financial markets. They allow you to pre-set rules on the purchase or sale of assets and seriously simplify the work of the trader. However, such systems can be used for manipulative purposes.

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Who influences the exchange rate of Bitcoin?

Bots operate freely in the market because of the lack of laws governing the industry. Co-founder and President of a startup CoinList Andy Bromberg said that now the market is thriving precisely this type of fraud. Activity bots harms the entire industry and individual investors, he added.

The Foundation's Representative Virgil Digital Capital with a volume of $ 80 billion said that the company has to fight with bots for operations on the market. Once the Fund lost a large amount because of the actions of automated trading systems.

Strategy bot was similar to "spoofing" — the practice in which investors place a lot of orders with a view to their eventual elimination. Other market participants see the demand for the coin and also start to buy it. This strategy was declared illegal in the U.S. stock and futures markets in 2010, but in the stock market it has been used successfully.

Another example was developed by trader software Quatloo Trader, which he calls the best tool for manipulating the stock market. According to the developer, to prohibit the manipulation of meaningless reports . Unscrupulous parties will find ways to manage the exchange rates of the coins and the demand for them.

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