Background
Since their creation, one of the biggest weaknesses with digital assets has been the centralized exchanges people are forced to trade them on. According to a recent Bitwise report to the SEC, 95% of trading volume is faked on exchanges, damaging the credibility and harming the supposedly trustless environment that Bitcoin was created to make.
While greed and manipulation will be hard to eradicate, Coinmarketcap, OceanEx, and a number of other key exchanges are stepping up to try and bring more legitimacy to the industry. OceanEx CEO Nan Xiaoning has always viewed digital asset exchanges as a dynamic industry that can achieve more by working together, and this alliance confirms his commitment to that.
The alliance, known as DATA (Data Accountability & Transparency Alliance, includes a number of other high-volume exchanges such as Binance, Bittrex, and Bitfinex. Most of China’s top exchanges are there as well, including Huobi, KuCoin, Gate.io, OKEx, and of course OceanEx. These exchanges are committed to providing Coinmarketcap with comprehensive trading data, to help verify trade volumes, increase transparency, and create industry standards that new and existing exchanges will be encouraged to uphold.
Going In-depth with OceanEx COO Wei Wang:
When discussing their motivation to join the Alliance, Wei Wang was quick to re-affirm OceanEx’s commitment to the long-term development of the cryptocurrency industry. He was adamant that “fake volume is burning the credibility of the crypto industry, contributing to its stagnation and backwardness.” He believes that the inflated volume misleads users and biases their judgment. New exchanges are particularly susceptible, as projects and new users are generally skeptical about volume and reporting practices.
He also noted that the deteriorating environment was noticeably damaging to their business model and the industry as a whole. For this reason, they chose not to wait, and approached CMC early this year to discuss the idea of setting up an alliance. In this manner, they could improve transparency across the whole industry and encourage the projects that are advancing community development and being accountable to users.
After that initial contact, they worked together via a series of discussions, leading up to OceanEx’s formal invitation as a DATA launch partner. Interestingly, OceanEx is the only Initial Launch Partner of DATA with a history of less than one year.
Being a member of DATA will benefit the ecosystem in a number of ways. Firstly, Wang believes being backed by CoinMarketCap, one of the most influential players in the market, will help bring more attention to OceanEx. OceanEx’s engagement in the alliance as well as their active role in the VeChain Ecosystem should help promote the exchange in a positive light. Transparency and accountability are core philosophies that are shared with VeChain, and are important for building trust with the user-base.
The Alliance should also help attract more quality projects who share similar values. By listing projects like this on the exchange, they can provide sound investment opportunities to the ecosystem.
What requirements does DATA have for OceanEx?
Wei Wang summarized the requirements listed on the CoinMarketCap webpage, and discussed how they were divided into 3 phases.
Phase 1:
- Live order book data provided via API.
These data points will enable analysis to determine liquidity, order book depth, spreads, and other meaningful measures. With these additional data points, users will be better able to contextualize the pricing and volume being reported on the site and API.
Phase 2:
For phase 2, CMC are planning to grow the types of data available for analysis, and enable filtering to allow deeper perspectives into the exchanges’ operations.
- Exchange hot/cold wallet addresses: Proof of Solvency/Reserves/Liabilities, or at least indicative numbers to enable users to determine solvency of selected exchange.
- Live market-pair trading status: More granular trading data at the market-pair level for further analysis.
- Live wallet status: Summary status of all possible deposits and withdrawals across currencies.
- Historical trade data: All time-stamped historical trades for tracking, and in some cases, compliance.
Phase 3:
For phase 3, CMC is encouraging self-reporting channels for both exchanges and cryptocurrency projects. This voluntary reporting is optional, but participants that self-report will benefit from greater exposure. By incentivizing transparency, they believe that the industry as a whole will benefit.
What other measures is OceanEx taking to provide users with more transparency?
Before Wei Wang concluded, he noted that transparency is something they intend to keep improving on. In addition to a monthly community update they have been providing since March, they also plan to begin working on periodic financial reports. By releasing key financial information, OceanEx can better connect and build trust with both users and investors. Finally, he noted that they also want to hear community feedback regarding this and other topics, so that they can continue to improve the platform.
Special thanks to OceanEx COO Wei Wang for his contributions to this article.
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