Allegedly, Binance was found to be heavily insider trading. With their massive size, how much of crypto markets and its prices are really real?
Binance was found to be insider trading with literally hundreds of accounts owned directly or indirectly by CZ through an investigation by the CFTC. Some have said that you should trust CEX and have your own custody of funds but that is very short-sighted and fails to see the big issue here.
The Binance platform held close to 70% market share before the allegations. This means that their actions contribute, generally, to 70% of the prices that Cefi/CEX’s contribute to a general token price. And Cefi currently contributes 6.4 times to the general market price than Defi(at least for Bitcoin), such that Binance contributes around 60% to a token general market price.
Thus, any price/market manipulation by Binance has a huge effect on the market price, especially with hundreds of entities doing insider trading either on behalf of and in partnership with Binance/CZ. So this is where we ask ourselves the hard question, how much of trading and prices is actually real? Sure the tech is still there and the utility also still remains present, but we all know most people are in it for the profit. Let’s not delude ourselves. We see how bear markets affect the activity of the millions of sub members here alone. How much of the prices that we see and that we celebrate are…well artificial, are not real? And then what does that mean for crypto?
Credit to u/MilesPower here for the initial piece:
submitted by /u/OneThatNoseOne