Mark Cuban predicts wash trading to be the next crypto explosion
Wash trading, which is prohibited in the United States, is a tactic used by traders or bots to manipulate the market by buying and selling the same crypto asset repeatedly
Photo by Jerod Harris / GETTY IMAGES NORTH AMERICA / Getty Images via AFP
Mark Cuban, a crypto investor and the billionaire owner of the Dallas Mavericks, believes that wash trading of crypto tokens on centralised exchanges will lead to the next "implosion" in the crypto market. He stated in an interview that 2023 would likely see numerous scandals in the crypto industry following the events of 2022.
Mark Cuban, who has invested in various crypto and Web3 startups, thinks that the discovery and elimination of wash trades on centralised exchanges will have a significant impact on the crypto industry. He mentioned that there are supposedly large amounts of trades and liquidity for tokens that have very little practical use, leading him to question how they can be so liquid.
Wash trading, which is prohibited in the United States, is a tactic used by traders or bots to manipulate the market by buying and selling the same crypto asset repeatedly. This generates fake activity and can give the impression of high demand for the asset, leading other traders to buy in and driving up the price.
Ultimately, the goal of wash trading is to artificially boost prices through deception, similar to a pump-and-dump scheme.
Mark Cuban noted that his prediction about wash trading causing the next crypto "implosion" was just a guess, and he did not have any specific evidence to back it up.
