Chinese Litecoin Volume Indicates Possible Fraud
Last week BitcoinPriceLive reported the rumor that fake Chinese Bitcoins and fake Chinese Litecoins were responsible for the latest cryptocurrency market crash. Our main observation was that LiteCoin volume is so incredibly high on the OKCoin exchange that it is likely fraud.
In the previous article we showed that one day volumes on OKCoin were roughly 12.2 million Litecoins. Seven day volume on OKCoin was 58.6 million Litecoins, and 30 day volume of Litecoins on OKCoin was 192.3 million Litecoins or nearly $1 billion worth of Litecoins exchanged hands in 30 days. Keep in mind the total Litecoins is circulation is publicly listed as roughly 32.5 million Litecoins.
Consider these numbers a different way: 508,000 per hour, 8,466 a minute, or 141 Litecoins a second are being traded on OKCoin.
Readers Comments About High Chinese Litecoin Volume
BitcoinPriceLive received comments that the Litecoin volume on OKCoin is so high because OKCoin charges no fees and allows bots to trade on their website. However, if programmed bots are continuously trading on OKCoin, then who is running the bots?
It would be useful to know if the exchange is running the bots, or if is individual programmers. Sophisticated trading bots for interfacing on a crypto-currency exchange are not easy to program. This requires both knowledge of market technical analysis and computer programming languages. It is highly unlikely the bots are written by individual Chinese traders at home.
Below is a picture showing the interface for a bot on the BTC-E exchange to give you an idea of how a Litecoin bot may look.
OKCoin Does Audit Of Chinese Bitcoins But Not Chinese Litecoin
Our readers pointed out a key fact that OKCoin underwent an audit in August 2014. However, this audit was only for their Bitcoins. There has never been an audit of the Litecoins on OKCoin.
Is it possible OKCoin is manipulating Litecoin assuming that nobody will be checking their Litecoin data?
OKCoin has been accused of faking trading data in December 2013, and they should not be given blind trust.
If you have any more information about this Chinese Litecoin volume on OKCoin, please leave us a comment below!