Monthly Crypto Commentary — March 2019

95% of the reported trading volume is fake. Many crypto exchanges grossly overstate their numbers.

Quick summary

  • March was a relatively calm month in terms of volatility.

  • We witnessed a minor market correction which marks a healthy development.

  • Recent analysis has concluded that 95% of the reported exchanges’ volume is fake.

Market overview

We entered the month amidst a correction phase which started on 23 February. The market bottomed on 4 March, having lost 13.2% of its value in 9 days. Occasional corrections are healthy and help prevent oversized price movements in one direction.

In March, we saw the continuity of the early bull market dynamics. The positive sentiment is increasing and after each correction, the buyers appear and propel the recovery. This dynamic is precisely the opposite of the one we had witnessed throughout the bear market, when, after each spike, the sellers immediately rushed in and depressed the prices. There were several intense battles between the bulls and the bears throughout the month and, as it is evident from the chart below, the bulls prevailed. The month ended with a modest gain of 8.5%.

Solidum 20 Market Cap Weight Index | March 2019
Source: CoinMarketCap, own calculations

Reported Vs. real volume of exchanges

The majority of market participants is aware of the fact that many exchanges are artificially inflating their volumes by “wash trading.” A wash trade is a form of market manipulation in which a market participant places a sell order and then a buy order to repurchase the assets from themselves, or vice versa. These continuous and simultaneous sell and buy orders create misleading, artificial activity in the market.

On 19 March 2019, Bitwise published a very informative presentation titled Analysis of Real Bitcoin Trade Volume (download the PDF here). The report thoroughly explains various methods applied by exchanges to inflate their volume. Bitwise states that only ten exchanges report real volume and that 95% of the reported Bitcoin volume is fake. If you are interested in seeing the actual volumes for Bitcoin and many other cryptocurrencies, visit Messari’s website which tracks the capitalization and volume of various digital assets. They recently added a column, presenting the volumes of only ten selected exchanges, identified by Bitwise to accurately report their volumes.


The market continues with a steady recovery, and as I stated in my previous monthly commentary, I believe that we are currently in a bull market and that every dip in prices should be perceived as a buying opportunity.



Solidum Capital also manages the Solidum Prime digital portfolio on the ICONOMI platform. You are welcome to read the Solidum Prime Monthly Report for March 2019 and why now is the best time to invest.

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DISCLAIMER: This article is for informational and discussion purposes only and does not constitute a marketing message, an investment survey, an investment recommendation, or investment advice. The article was prepared exclusively for a better understanding of market dynamics.

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