Cryptocurrency exchange CoinExchange has reportedly failed to comply with CoinMarketCap’s recently established transparency and accountability requirements.
This act of non-compliance was first brought to the attention of the price aggregation platform by open-source blockchain project StrongHands (SNHD) on July 4, 2019.
Please work together to get the verifications done. This process is being painful not for us but for all other coins listed!
This lack of communication is creating big problems to holders and supporters! pic.twitter.com/NC8wwkTUKZ
— StrongHands Project (SHND & SHMN) (@shndofficial) July 4, 2019
Taking note of the non-compliance, CoinMarketCap responded,
“This is a consequence of the implementation of Phase 1 of our DATA initiative. Exchanges that did not comply will be excluded from volume-weighted average price and adjusted volume on CMC. They can be reinstated once they submit the required API updates.”
Increased Data Accountability and Transparency: The Vision of DATA
In May of this year, CoinMarketCap formed an alliance called the Data Accountability & Transparency Alliance (DATA). Many leading cryptocurrency exchanges such as Binance, Huobi, and OceanEx joined the initiative at launch and pledged to submit live trading and order-book data within 45 days.
While most major exchanges were quick to meet this demand, smaller ones were either unwilling or technically unable to.
Months later, only a mere 70.3 percent of all exchanges currently listed on the site have adhered to these requirements. Exchanges that fail to comply with CoinMarketCap’s data disclosure requirements will be listed below those that have done so on the rankings.
We are listening to all our users' feedback, and we are working hard to add a suite of new metrics so users can get a fuller picture of exchanges and crypto on the site. What are some new metrics you would like to see? Share with us. 🙂 https://t.co/ZgEs80lH1S
— CoinMarketCap (@CoinMarketCap) March 26, 2019
CoinMarketCap introduced the alliance shortly after Bitwise Asset Management published a report stating that roughly 95 percent of reported bitcoin trading volume was found to be fake.
In light of the news, CoinMarketCap said that it would take steps to ensure that users would be able to make better and more informed decisions.
For the exchanges, it would mean that they would be better able to differentiate themselves and market themselves better through enhanced disclosures and transparency.
An Overhaul of CoinMarketCap
Roughly two weeks ago, on June 26, 2019, CoinMarketCap acquired electronic crypto trading fund Hashtag Capital. According to CoinMarketCap, the acquisition of the company would enable them to use the fund’s “true price” algorithm to replace its existing pricing model.
Simultaneously, Hashtag Capital’s key engineering talent was picked up by the price aggregator and tasked with improving the platform’s analyses and algorithms.
With these improvements, CoinMarketCap appears to be determined to continue holding its rather large market share in the price aggregation space.
With CoinExchange penalized by CoinMarketCap for failing to comply with its rules, do you think that other exchanges will follow suit in the near future? Let us know your thoughts in the comments below.
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