Recently, Binance made the announcement that they would no longer charge trading fees for certain Bitcoin trading pairs. The entire cryptocurrency community rejoiced over this because it gave investors access to Bitcoin without having to pay trading commissions. 13 spot trading pairs, specifically BTC/AUD, BTC/BIDR, BTC/BRL, BTC/BUSD, BTC/EUR, BTC/GBP, BTC/RUB, BTC/TRY, BTC/TUSD, BTC/UAH, BTC/USDC, BTC/USDP, and BTC/USDT, were impacted.
The demand from analysts to remove Binance (or at least these trading pairs) from volume calculators is now rising as a result of this. But why is this request being made, exactly? the information traders receive about actual trading volumes is impacted by washing trading, which is taking place.
Zero-Free Trading for BTC Spot Trading Pairs is now Available on Binance
As previously mentioned, on July 8, 2022, Binance launched a zero-free trading program. 13 different trading pairs linked to Bitcoin, fiat currencies, and stablecoins were part of the zero-fee program.
The result was a rise in trading volumes. When there are no trading fees, this is something that happens quite frequently. As a result, scalping investors become more effective (they can profit from very slight price changes by making hundreds of trades per minute), but it also raises the possibility of wash trading.
Investors can immediately fill both sell and buy orders (or vice versa) with wash trading. A trader’s automatic completion of a buy order with a sell order provides misleading information to other market participants.
In fact, it is against the law to engage in this practice here. Wash trading might boost trading volume artificially. And in fact, this is what took place. These 13 trading pairs don’t accurately represent the current volume because they count trades that shouldn’t be counted.
Experts Disagree With Wash Trading
On Twitter, renowned investor Alex Krüger noted that Binance has seen “extraordinary wash trading volumes.” When the announcement was made and people started trading without fees, trading volumes increased up to 18 times. He has also explained on Twitter why charting on Binance is useless due to these volumes.
On the subject, Alex Krüger said:
Since 10AM EST, when @binance eliminated fees on spot trading for BTCUSDT and other pairs, there have been extraordinary wash trading volumes in Binance.
Alex Krüger claimed that despite the efforts made by Changpeng Zhao and the Binance community, Binance spot trading pairs continue to display fake volumes that are 5 times larger than typical volumes. He persisted in requesting that Binance be taken out of the volume calculation.
Before we see these trading pairs charging fees once more, it would only be a matter of time. The issue raised on Twitter by trader Alex Krüger might be resolved as a result of this. The free trading period will continue until “further notice,” according to Binance’s official announcement.