DATA Alliance Roundtable Aims to Enhance Transparency in Crypto Market

Asia Blockchain Review

August 30, 2019

The project initiated by CoinMarketCap (CMC) to promote greater transparency, accountability, and disclosure from crypto projects worldwide is progressing into its second phase with its first-ever DATA Alliance Roundtable. The discussions saw dozens of leaders and influencers in the cryptosphere gather to share their insights on the direction of the alliance’s efforts.

CoinMarketCap is a price-tracking website for cryptocurrencies, serving as one of the most referenced and trusted sources for comparing crypto projects in the market.

Empowering Crypto Traders to Understand Market Data

According to CMC, the Data Accountability & Transparency Alliance (DATA) is aimed at empowering crypto traders to make more informed decisions regarding their investments, while also providing a way for projects to stand out among others with more disclosures and self-reporting.

During the first phase of the DATA project, CMC collected live trading and order book data, while excluding exchanges that did not provide the requisite data. Within this phase, over 70% of all exchanges listed on CMC disclosed their information to DATA.

In the second phase, the crypto alliance aims to address volume concerns and explore the possibility of using a new ranking metric as well as a new self-reporting dashboard.

Concerns over Inflated Crypto Trading Volume 

During the roundtable held on August 27th, 2019, CMC led discussions on topics such as volume problems occurring in the crypto space and the proposal of establishing a unified crypto-asset registry.

Geral Chee, Head of Research at CMC, revealed that it is difficult to regulate trade volumes for cryptocurrencies, thus leading to the occurrence of “wash-trading” or volume manipulation.

“In manipulating trade volume, the project’s volume and rankings are affected,” Chee said. “Though prices are not affected, this activity creates the illusion of market interest.”

Others at the roundtable agreed that wash-trading is hard to identify for experts and almost impossible to identify for traders. 

CMC proposed using liquidity as a metric in addition to volume, adding that the firm will need to carry out further data analysis, request partner feedback, and find a way to incentivize positive behavior in the market.

Next Steps for DATA Alliance

CoinMarketCap also proposed the establishment of a Unified Cryptoasset ID (UCID) that will drive industry standardization and operational efficiency across the board for crypto projects.

“I believe that if we can unify all this data, it will encourage wider crypto adoption in the market,” said David Brasch, Listings Engineer at CMC.

Concluding the discussion, Carylyne Chan, Chief Strategy Officer of CMC, said the team will consider all suggestions from roundtable participants and update the community with the launch of its metric during CMC’s inaugural global event, ‘The Capital’, scheduled for November 12th – 13th in Singapore.

“We will take the inputs today into account while continuing to refine the ranking metric for launch on November 12,” said Chan. “Meanwhile, we will work on creating a dashboard for self-reporting data by projects and exchanges, and we will further improve and fine-tune the Unified Cryptoasset ID system.”

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Asia Blockchain Review is the largest initiative for media and community building in Asia for blockchain technology. We aim to connect all blockchain enthusiasts on a regional scale and facilitate the technological foundation of blockchain through a range of group discussions, technical workshops, conferences, and consulting programs.

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