The crypto market is one of the markets that people search for the most to make profits. Unfortunately, this market is not always fair, and there are big people who exploit their power to play on prices, whether by raising or lowering them, and this affects people who trade with small amounts. Let's explain more and see examples that happened recently.
How do adults play in the market?
Spoofing
Whales place huge buy or sell orders in the market to give the impression that the price will change, and after the small traders make a decision, the whales quickly cancel these orders.
Wash Trading
Whales buy and sell at the same or similar prices to make it appear that there is a big movement in the currency. This tricks people into entering the market.
Suspicious movements on small platforms
They buy huge amounts of an emerging currency and drive up its price, then sell when the price reaches its peak, which hurts those who bought at the peak.
Recent Examples of Market Manipulation (December 2024)
Transferring huge amounts of Bitcoin to trading platforms
On December 10, large amounts of $BTC moved from unknown wallets to exchanges. This made people worry that a big sell was coming, and indeed the price went down after that.
Ethereum mining before major update
In December, whales bought huge amounts of $ETH before "Ethereum 2.0" came out, which pushed the price up abnormally. After the update, the price stabilized, and many people lost.
Bitcoin Futures Liquidation
On December 20, there was a massive liquidation of Bitcoin futures contracts by whales, which caused huge volatility in the market and caused many small traders to lose.
Robots create fake movement
At the end of the month, trading robots appeared that worked 24 hours a day, making buy and sell deals on the same currency quickly, in order to make people believe that there was a lot of activity. People entered the market, but they lost when prices returned to normal.
Emerging coin price hike
On December 25, whales moved huge amounts of a startup coin on small platforms, the price skyrocketed, and then they sold on large platforms, which made the price collapse afterwards.
How platforms like Binance are required to protect the market
Detect fake orders using advanced technologies that can detect orders that are quickly cancelled or that are intended to mislead the market.
Penalizing violating accounts: Imposing fines or banning accounts that engage in manipulation, whether through fraud or money laundering.
Controlling robots: Reducing the impact of trading robots that create fake price movements. Increasing transparency:
Improve the order book to show whether orders are real or not, and impose a time limit on orders to prevent quick deletion.
Crypto market manipulation does happen, and this is something that traders need to be aware of. The big platforms have an important role in protecting the market from whales, but traders also need to be aware and use tools that help them make better decisions. Be careful of sudden big moves and always try to think before entering a big deal.