One of the problems facing Bitcoin and other cryptocurrencies is the constant manipulation of prices. A relative calmness in the crypto markets seem to have relegated this crisis, but Nasdaq says it has a permanent solution.
According to a Bloomberg report, the world’s second-largest stock exchange operator, Nasdaq released a paper on Thursday. The publication pointed out that Nasdaq has spent decades to develop tools that fight against market manipulation.
At the top of the toolbox, SMARTS Market Surveillance is a solution which the tech-heavy exchange claimed have been effective for policing “securities, currencies, and other markets.” Bringing this solution to the crypto markets will ultimately ‘stamp out’ price manipulation.
A line of the paper reads,
“Regulators, brokers and exchanges have surveillance teams that monitor activity constantly and advanced technologies to help capture and analyse abusive behaviours including pump-and-dump schemes, insider trading, wash trading as well as spoofing and layering.”
There have been days when a quick rise and fall in the prices of cryptocurrencies have been attributed to price manipulation, especially by groups who control a large percentage of the market cap.
Will Nasdaq’s SMARTS Market Surveillance tool really end crypto price manipulation?
Gemini Has SMARTS Market Surveillance License
In April, the Gemini exchange operated by the Winklevoss twins became the first crypto firm to try out Nasdaq’s new solution. At that time, it was revealed that the technology would help Gemini by sending notifications about unusual trading behaviour.
Tony Sio, Nasdaq’s head of exchange and regulator surveillance said in the latest publication that more firms are now approaching them for the solution. For this reason, they are picky about whom to work with.
“We won’t work with all of these firms though since a lot of them are quite early stage or not reputable yet,” Tony Sio added.
Do you see more crypto exchanges and firms adopting Nasdaq’s SMARTS Market Surveillance tool?