Wash trading
Is volume in this market real, or is a participant trading with itself?
In plain English
A group of connected accounts traded among themselves in this market. That can make a market look busier than it really is; it is also exactly what an authorised market maker looks like, so the first question is whether these accounts are declared.
What the record supports
- Trades where both sides belong to the same group of linked accounts.
- The share of a market's volume that never left the group.
- Repetition: the same pair of accounts meeting again and again, in the same market, over a sustained window.
What the record does not support
- Intent. Self-trading is what an authorised market maker does all day. Public data cannot separate the two, and this is the single question our reconciliation layer exists to answer.
- Trades settled off the public record, if the platform keeps any.
Obligation
Why it matters.
Artificial volume makes a market look deeper and more actively priced than it is, which draws in participants on a false picture of liquidity. Monitoring for economically irrational trading sits in the anti-money-laundering conditions of a typical operating licence, and reporting duties attach to it.
We describe what was detected and which duty it engages. Whether any obligation has been breached is a judgement for the operator's compliance and legal function, not for an instrument.
See the rest of the set.
Twelve indicators across three obligation families, each with its coverage stated as plainly as its capability.