Bitfinex Digital Currency Exchange uses its dedicated market monitoring tool to combat the abuse of market conditions. This tool is called a Shimmer.
According to Cointelegraph, Shimmer is a strategy to identify and monitor market manipulation and suspicious transactions on the currency. Bitfinex expects that the integration of this tool with the currency trading engine will improve market health and transparency.
From now on, suspicious trading activities will be notified via email to the Bitfinex team. This includes all currency pairs, futures, and margins of this currency exchange. The company hopes that Shimmer will be able to prevent activities such as wash trading and layering. Paolo Ardoino, director of Bitfinex technology, said:
Extensive market monitoring and trading capabilities are required to operate a leading digital currency exchange service. […] Bitfinex has decided to develop its highly advanced surveillance system. This helps to identify halt manipulation and suspicious behavior.
Arduino explained to Quintelgraf that “Shimmer processes all data on orders and transactions and tries to find patterns related to layering, spoofing, and other manipulation.” He also said that because trading robots make a lot of transactions, in order to avoid their misdiagnosis, the system “can learn to change its threshold for the user activity.”
Arduino said Bitfinex plans to release Shimmer’s open-source code in the future but did not specify a date for it. Also, a spokesman for Bitfinex told Quintelgraf that when the transaction is detected abnormally, the company may take different actions based on the severity of the activity.
As the digital currency market has become less regulated, it has long been blamed for being more vulnerable to manipulation than its traditional competitors. For example, in November 2017, a study acknowledged that only one investor in the whale was responsible for the historic rise in bitcoin prices in the year 2019. However, shortly afterward the theory was rejected by other sources.
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