It has been a rocky few weeks for crypto. After the market seemingly came out of an extended bear run, prices fell sharply this week reversing about two months of market progress. Then, of course, there is the drama that extends beyond the market.
The former CEO of OKEx, Chris Lee, is leaving the world’s largest exchange by volume to lead rival exchange, the third highest ranked, Huboi.
Perhaps recent trouble at OKEx might have something to do with it. Although this hasn’t been proven as the reason for Lee’s departure, a string of questions regarding the legitimacy of OKEx’s businesses practices have surfaced. If you look at recent news from OKEx over the past few months, you can imagine how the exchange’s developing negative reputation may have added to Lee’s choice to leave.
Earlier in May 2018, the government mouthpiece China National Radio (CNR) has raised doubts about the legality of services offered by the OKEx. Even further, CNR said the OKEx had not only survived after the ban, but it violated the national law by offering Bitcoin contracts to mainland China investors after it had claimed to move its business overseas.
Other problems facing OKEx is their major liquidity issue. Although they are not the only exchange facing this problem, OKEx scored terribly on what is known as the Slipage test. This test is pretty simple: Buy $50,000 (USD) on an exchange and measure the rate of decline for whatever crypto you purchased. The original researcher found that OKEx had a much higher slippage rate than other major exchanges. You can read more about the results of this test here.
This research conducted by Sylvain Ribes has been largely accepted and widely viewed. The 18K Clap response on Medium shows the tremendous amount of community support behind these findings. If the researcher is correct, he has determined that OKEx and other major cryptocurrency-only exchanges are fabricated and inflated.
Other reports said the inflation numbers are as high as 90% for OKEx.
Other investors and enthusiasts have accepted the reality of over-inflated markets and questioned what the general consequences of it are, good or bad.
It’s still a wild west out there in the crypto universe where rules go out the window. This is the arena where glory and wealth awaits the person who knows how to game the system. Everyone knows that exchanges play a dirty game of market making, well, because they can. Chris wouldn’t be the first nor the last, but perhaps OKex might open the floodgates to regulatory bodies coming in to nanny us helpless crypto investors. On one hand I dislike being played, but on the other hand, I dislike regulations even more.
So before you crucify Chris Lee for his life choices, I leave you with these words of wisdom from five times WCW World Heavyweight Champion, Booker T:
Don’t hate the player, hate the game.
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