Crypto Indices Provider CryptoCompare Launches Crypto Exchange Benchmark
CryptoCompare, a provider of cryptocurrency data and indices, launches the Crypto Exchange Benchmark. Reportedly, the company does it for the first time. The company aims to provide a clear picture of trading volumes of various cryptocurrencies with this move. Remarkably, the exchange ranks among 100 active exchanges in the world.
However, the launch comes out in the midst of growing concerns on different trading schemes. Precisely, there are trading schemes like incentivized trading and wash trading that is currently major concerns in crypto-domain. Crypto exchanges use these trading schemes to raise volumes.
Therefore, CryptoCompare says that the Exchange Benchmark highlights creation activities. According to it, the issue is getting worse due to the lower quality of exchanges. They actually increase the market share to about 30 percent in a matter of the last twelve months. As a result, it demonstrates the growing need for a methodology of ranking. And, the firm also claimed that such methodology would not depend upon aggregate market volumes.
Further, the firm’s new product will offer comprehensive, reliable, and granular information to the traders and investors. The firm also claimed to provide the best information o various trading venues.
Charles Hayter CEO and co-founder of CryptoCompare excited on the launch and explained its necessity
On the other hand, the CEO and co-founder of CryptoCompare, Charles Hayter, comes forward to comment. According to him, they are excited in launching CryptoCompare Exchange Benchmark to assess various crypto exchanges. He added that the initiative was necessary because there are growing concerns on inflated volumes. Further, Hayter claims that with the initiative, they will provide reliable metrics for crypto exchanges assessment. In addition to it, he says that they are looking ahead to bring high transparency to digital assets. The initiative not only will improve decision making to crypto-participants, but it will also provide a trustable dataset.
As per the press release of the company, CryptoCompare, it listed some exchanges that are trusted the most. However, the basis on which the company lists is exchange data analysis during May 1 to May 31 this year. It includes crypto exchanges such as Coinbase, Binance, Poloniex, Kraken, Bitstamp, itBit, Gemini, Liquid, Bithumb, and bitFlyer.
While the analysis said the list is based upon public information, it also includes other factors. Precisely, the factors are, for instance, geography, investment, regulatory, data provision, company, market quality, and trade surveillance.
Exchange Benchmark will employ qualitative and quantitative approach and use different methods of calculation
In a similar fashion, the new product, Exchange Benchmark will employ qualitative and quantitative approach both. As per matter of fact, the qualitative approach is based on due diligence. On the contrary, a quantitative approach is the market quality which is dependent upon trade data and order book. The initiative will and correlation of volatility and volume. In those methods, the product will use inputs to about more than 30 metrics.
Additionally, it will collect those inputs and feed them into aggregate indices of CryptoCompare. The aim of doing so is that it will create a rate of references for top exchanges. As a result, it will establish a dataset that is unique and trustworthy.
