Countinghouse: Fight Market Manipulation

stazhao (61)in #ethereum • 6 years ago (edited)

There's an investigation happening to see if crypto markets face market manipulation. The reality is that of course crypto markets face manipulation. Many times we can scroll through the order book on an exchange to see obvious market manipulation. Crypto is unregulated so market manipulation is common in this market. Human emotions take over and force people to end up being manipulated. Hedge funds that use algorithmic trading hand over the trading to computers. Computers don't have emotion and just make objective decisions. Countinghouse is a hedge fund that has been trading fiat with algorithmic trading and they did really well. Countinghouse is bringing its algorithmic trading to crypto markets. This will help investors become bullet proof to market manipulations because their emotions won't be affecting their investment decisions now. Instead they can allow Countinghouse and its algorithmic trading to manage their funds.

There are some very common market manipulation methods. The most popular one is pump and dump. We can get greedy and can subjectively read the shilling of pump and dump teams. Most people who give in to joining a pump and dump usually end up with losses. Countinghouse's algorithmic trading will be immune to the shilling pump and dump groups. Also, since these are computers at work, if the fund ends up investing in a coin that is being dumped, the computers will be able to finish the sale before the pump and dump.

Another common type of market manipulation is when coins use market makers. Market makers bring liquidity but they also make it look like the coin has become stable of has reached a lot of volume The reality is different and people who take this market manipulation as usable data will end up making a bad long-term investment. Again Countinghouse and its algorithmic trading will be have the ability to recognize market markers.

Another horrible way of market manipulation is when whales force order books to prices they want. Large sell wall and buy wall could be set to force the market trade in the amount the wall wants. Often the goal of this is to pull the sell wall lower and force people to selling into the whale's buy wall. Countinghouse and its computer systems will be able to see when this type of situation is happening and will avoid taking large risk in coins being manipulated. Also, if the whale forces an arbitrage, Countinghouse is an expert fund at taking advantage of arbitrage and will turn the tables against the whale.