CoinMarketCap Introduces New Metrics To Combat Fake Volume
Crypto data aggregator CoinMarketCap (CMC) has introduced new metrics ranking exchanges and market pairings intended to reduce the impact of fake volume on the platform’s data.
On May 29 CoinMarketCap introduced its new ‘Confidence’ metric to flag suspicious volumes reported by exchanges.
You asked for it, and we're proud to deliver it! Check out our new ranking system and Confidence indicator for more than 22,000 market pairs, spanning more than 5,500 cryptocurrencies! https://t.co/FMwmdKLqYm — CoinMarketCap (@CoinMarketCap) May 29, 2020
The factor uses a machine-learning algorithm to examine all data ingested by CMC:
“to determine if the volumes reported by exchanges are inflated, and to what extent”
CMC has also introduced a new default ranking system for market pairings across the platform, replacing the current metric of volume for default sorting.
CMC will use a single algorithm considering the Liquidity Score, Web Traffic Factor, and volume of each pairing.
CoinMarketCap soon plans to introduce the factor as default sorting for exchange rankings on its platform as well.
On May 22, CMC removed its ‘adjusted volume’ metric, which excluded volumes generated by pairings without transaction fees, pairings with transaction mining, and derivatives.
A post published to the platform’s blog stated that users were confused as to the nature of the pairing, with many inferring that the metric sought to combat inflated volumes.
Source: Cointelegraph | Image: Pexels