Sadly it would appear that nothing is sacred in the world of crypto. This shouldn’t be news to any of us, though it is always sad to see when it hits close to home.
I have caught the exchange Daybit (https://daybit.com/) wash trading Trybe’s TRYBE tokens in an attempt to boost their apparent volume, at least that is how it appears. I’ll tell you the story and show you the screenshots – you can decide for yourself.
For several months I have watched TRYBE price fluctuate wildly on my “Favourites” list at CoinGecko. TRYBE is normally either my main winner or loser over the typical time periods of 1h, 24h and/or 7d.
The active exchanges listed for TRYBE are Daybit and Newdex. Prices vary wildly between the two exchanges. To me that means one of two things: either there is an arbitrage situation or there is rampant wash trading taking place. At first I thought I had found an arbitrage opportunity, but watching it over time I saw that the daily price changes of Trybe are nonsensically volatile. There should be no way that such a spread could be sustained with that sort of trading volume.
I decided that in order to do a more thorough investigation, I should get some skin in the game. Instead of blogging yesterday, that is what I was up to. Admittedly it took longer than expected. I had recently used my Scatter Wallet to carry out the WAX mainnet swap and things were looking unfamiliar to me in the already confusing EOS economy system. The WAX swap entailed importing new keys and switching networks in Scatter, as well as using both the old and the new (version 11) of the wallet. I elected to move carefully in unfamiliar territory.
I decided to withdraw a few TRYBE tokens which I have earned on Trybe in order to carry out the experiment. This was the first time that I have tried to withdraw from Trybe, so that took me a few minutes to sort out. Unfortunately it turns out that there is a delay in withdrawing from Trybe: tokens withdrawals are only processed once a day. On top of that: only 1000 tokens can be withdrawn at a time (though I remember reading that that would be increased to 5000 soon). I executed a withdrawal request, but then couldn’t afford to wait all day for it to be actioned. So I needed another plan to get my hands on some TRYBE.
Fortunately I had some STEEM and SBD available. I converted SBD to STEEM, sent all the STEEM I could lay my hands on to Binance, traded STEEM for BTC, traded BTC for EOS, sent EOS to Scatter, logged into Newdex with Scatter and finally traded EOS for Trybe. With that Trybe in hand I made my way to Daybit to run my test. I logged in and noted the previous trades. They looked like this:
As you can see: there is a long line of orders executed at a price of 0.00148560 EOS. It is important to note that they were all for just over 300 000 TRYBE and that they had been executed over a very short space of time. It had also been several hours since the time of the last trade. Before that time there had been a gap of many hours, and then a cluster of similar trades – already very suspicious.
With 0.00148560 as the selling price for all the trades shown and with the cheapest current order on the platform being 0.00148570, I decided to send my TRYBE to the exchange and place a sell order at a price of 0.00145000 EOS, which I then did. Take note: the price shown for all the “Recent Trades” is 0.00000010 EOS below the price of the lowest sell order – you will see why this is important later on.
I placed a Sell order for 14900 TRYBE at a price of 0.00145000 EOS (a limit order).
Nothing happened. Then more nothing happened, and finally a whole lot of nothing. Eventually I stopped watching went to sleep.
THE NEXT DAY…
I woke up this morning to find that (surprise, surprise), my order had not been touched, even though it was still the cheapest order. BUT: a whole lot of new “Recent Trades” had appeared in the logs:
Thousands of dollars in TRYBE orders had magically appeared during the few hours that I had been asleep. Once again: all the same price, all right after one another (and then absolutely no activity after that) and all for about 300 000 TRYBE. What was the price of those orders? Exactly 0.00000010 EOS below the price of my sell order…
So I cancelled my order and placed a new one at a MUCH cheaper price: 0.00080000 EOS. Anybody prepared to buy at 0.00144990 should immediately snap that up… but no, the order has now stood there untouched for hours.
From this I conclude that Daybit is using TRYBE to try to inflate its volume and to boost its popularity. As further evidence of this, I can offer the following:
Daybit uses four base currencies for its trading pairs: BTC, EOS, ETH and USDT. Here is a complete record of the alleged trades recorded for each of those base currencies over the last 24 hours (at the time of writing):
EOS – note the very high TRYBE volume and the zero volume for everything else except “DAY”:
BTC – a little bit of DAY (suspiciously close to the amount traded for EOS), some HUNT, a small bit of STEEM and a lot more zeros.
ETH – a world of nothingness – the list carries on, but as you can see I have ordered it by decreasing volume – nothing has been traded.
USDT – More nothing
As you can see on CoinGecko: the total claimed trading volume of Daybit over 24 hours was just over $500 000, most of which came from TRYBE.
Yet my orders never even triggered.
I’m calling Daybit out on what is obviously Wash Trading. I don’t know why they have picked TRYBE, perhaps they feel it is “below the radar” enough not to get noticed. Hard luck Daybit, it’s been on my watchlist for months – and I don’t miss much.
Decide for yourself if I am right, I don’t see how I could possibly be wrong. In light of this, I will be ensuring that CoinGecko gets this information so that they can improve their “Trust Score” algorithm (which I have written about in the past). At the moment Daybit is too small to even get a Trust score, but the sooner CoinGecko knows about it, the more they can keep an eye on it and the better for us all.
Bad actors are a blight in the crypto space. I will fight them wherever I find them, be it a little wash trading by a small exchange or the mighty Facebook, Ripple or JP Morgan and their self-serving “cryptocurrencies”.
As a community it is up to us to self-regulate. Nobody is going to regulate crypto for us if we don’t do it ourselves. (Yes we all know the banks and governments will try in vain – much to our amusement!) Dishonesty in this sector is bad for us all, it breaks trust and gives crypto a bad name. Wash trading is a major problem, what you see in this post isn’t even the tip of that iceberg, some major exchanges do it all the time. We all need to stand together to say that we will not accept it.
I recommend that if you want to buy or sell TRYBE then you do so on Nexdex. It works smoothly with Scatter and is non-custodial – making it cheap, easy and secure to use – just as a DEX should be.
To the Trybe team: I suggest automating the withdrawal process and increasing the withdrawal limits. For Trybe to find fair price, get noticed and to gain popularity as a token, it needs to be traded, spoken about and visible on the exchanges.
For the record I don’t think that TRYBE is the kind of token that one should be trading right now: it’s still a small token and the value of such tokens lies mainly in holding them and staking them while they are still cheap. My readers will know that I’m far more interested in investing than in trading. As a community let us all try to grow our TRYBE in the healthiest way possible: let’s spread the word and let the price grow organically. I definitely suggest that you avoid using Daybit for TRYBE trading.
Yours in crypto
“The secret to success: find out where people are going and get there first”
~ Mark Twain
“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful”
~ Bit Brain
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