The price of Bitcoin is still on a downward trajectory leaving investors confused whether to withdraw from the market or to wait and see if the price will assume an upward movement soon.
A research done by CryptoCompare, a source of live cryptocurrency prices, trades, and volumes, has found out that Bithumb, a South Korean crypto exchange, propped up the price of Bitcoin at $6,000 after which the price of Bitcoin started decreasing. The research findings were compiled after a keen survey of trading volumes on global virtual currency exchanges.
The report noted that the South Korean crypto exchange had the highest daily trading volumes between the month of October and November. The daily turnover averaged 1,240,000,000 U.S dollars which converted to a 284% increase with other global giants like Binance recording a decline in their daily trading volumes.
Even as such, CoinMarketCap, a leading website that aggregates cryptocurrency data,still listed Binance as the leading exchange. The reason? The research found out that the trading volume at the South Korean crypto exchange was largely inorganic.
According to the research, high trading volumes on Bithumb were as a result of offers such as the ‘Super Airdrop Festival’. These offers propped up the daily trading volume on the exchange and subsequently held the price of Bitcoin at levels above $6,000.
“This increase in volume follows after Singapore-based BK Global Consortium bought a controlling share in the exchange in recent months, and later implemented a series of airdrop competitions, raffles, rebates, and other programs designed to incentivize non-Korean users to sign up to the exchange and trade in exchange for rewards. They have also implemented a potential form of trans-fee mining for certain users, where trading beyond a specific volume is rewarded in the form of ‘Bithumb Cash’ at a later date, ” noted the report.
To support this narrative, the research records that at the time of these offers the price of Bitcoin was relatively stable around $6,000 but, when one of the offers ended, the price of Bitcoin dipped below $6,000 never to come back up.
Although some crypto enthusiasts may blame Bithumb for the current slump in the price of Bitcoin, the exchange helped delay the entry of the bears.
Do you think the price of Bitcoin will assume an upward trajectory in the near future?
Let us know your thoughts in the comments section below.