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There are some fundamental errors in Crypto-Markets

Dec 26, 2017 Posted /  3010 Views

There are some fundamental errors in Crypto-Markets

Cryptocurrency trading is not really a new concept but it can be definitely appraised as an old concept being transformed into a unique technology. The rapid growth in Bitcoin’s value (almost 1,600%) and its astounding assimilation into conventional investment markets through futures contracts has helped in providing an appealing pursuit to crypto trading. The complete market cap of cryptocurrency has surpassed more than $400 billion, and at present crypto, trading has become one of the most talked about investment opportunity available in the marketplace.

However, several traders have explicated that crypto exchanges lack the basic technological advancements and even the basic trading features found on the most conventional investment exchanges. This poses a big question for the existence of the cryptocurrency.

You will find that even if the cryptocurrencies are trending a lot more, however, the exchanges, which are premeditated to assist the buying, and selling of digital currencies are substandard and incompetent. In its present state, they are the tangible expression of people’s most horrible qualms about cryptocurrencies. In all genuineness, they are a deficient inequity between exchanges and utilize preposterously obsolete technology.

It’s unambiguous that cryptocurrencies are going to be a pertinent part of the monetary ecosystem marching forward, but these issues need an answer. Probably by creating awareness that crypto markets have some fundamental errors, the cryptocurrencies may thrive.

The Liquidity Issue

Some of the philosophies, which make cryptocurrencies so attractive, are the decentralized and independent attribute of these technologies. We need to remember that these particular characteristics also make them a liability when trading. When buying or selling digital currencies contributors can decide from over 100 exchanges, and price fluctuations appear amongst those exchanges only. Interestingly, the World Economic Forum scrutinized price discrepancy between just three crypto exchanges, and found “large disparity between the prices of Bitcoin.”

WEF has listed numerous reasons for these price differences, which induced time and value gap and concluded that it results from exchanging Bitcoin to USD and back to Bitcoin.  However, the pricing differences can majorly be credited to the deficient in supervision and regulation.

Obsolete technology

There are many new investors, which are right now streaming the crypto exchanges. These new participants get irritated with obsolete and outdated trading arrangement that can be overridden with the functionality of a simple website. Concurrently, a very basic task like altering an order price or size can be prohibitively incredibly complex. Cryptocurrencies are proposed with rapidity and technological modernization, so these limitations might obstruct their aptitude to function successfully.

Sadly, the obsolete technology is not simply associated with the investor familiarity. Algorithmic triggers, which discontinue trading when the market is faced by seismic, price fluctuations. These price swings actually distort the market and make them insufficient or absent on crypto exchanges.

The reports by CNBC state that contrasting to many regulated stock exchanges, cryptocurrency exchanges does not require circuit breakers in place to pause the trading during wild price rallies. In fact, if we evaluate the rally of Bitcoin in the current year there have been a tremendous growth, however, Bitcoin had four different cases in points where the price stooped low by 50 percent or more. The evaluators suggest that it is relatively regular in crypto markets, which means there is a serious lack in the mechanisms and processing systems and it is particularly problematic for any user.

Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .

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Tags: investment exchanges Crypto-Markets Cryptocurrency trading

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