Binance knows your Stop Losses and will liquidate you

I have proved before in this post that the big boys are big enough to push the price wherever they want. Now we have the smoking gun.

From the CFTC's suit against Binance:

During the Relevant Period, Binance has traded on its own platform through approximately 300 “house accounts” that are all directly or indirectly owned by Zhao, as well as accounts owned by Merit Peak and Sigma Chain. Zhao has also traded on the Binance platform through two individual accounts. … On information and belief, Binance’s proprietary trading activity on Binance’s own markets is directed by Binance’s “quant desk.”

Binance does not disclose to its customers that Binance is trading in its own markets in its Terms of Use or elsewhere. Consistent with its apparent attempt to keep its proprietary trading activity on its own markets top secret, Binance has refused to respond to Commission-issued investigative subpoenas seeking information concerning its proprietary trading activity on Binance, including transaction data and communications among the members of the Binance “quant desk.”

In other words, they are stopping you out on purpose when they see enough stop losses to give them an opportunity. Liquidating you, deliberately.

I wonder how many Stop Loss Orders there are in the YELLOW areas.

This is not a story about Binance, and I don't expect the exchange to fold. However, it is a story about Crypto, and why, if you want to be a trader, you should probably use FX or Commodities or Stocks or Indeces. While there is lots of manipulation in these too, it's not as blatant and commonplace, because with regulated products the criminals risk jail time.

評論:

What doesn't help is that exchanges like Coinbase have asked repeatedly to be regulated and the SEC is unwilling.