Coinmarketcap is one of the top crypto tracking tools. It shows a detailed list of all cryptocurrencies and exchanges along with their real-time market data. However, the tracking system was always under the radar owing to the display of fake trading volumes. To overcome these shortcomings, CoinMarketCap has added a new metric to its Exchange section. The metric is termed as Liquidity. CoinMarketCap lists the exchanges based on reported volume, adjusted volume and now Liquidity.
Earlier, CoinMarketCap had organized its inaugural conference, The Capital. This new metric rollout was first announced at this conference. However, the feature is still in beta phase. The liquidity metric will be rolled out in three phases on CoinMarketCap’s website. First, it will be applied to influence the ranking of market pairs, followed by exchanges, and finally to crypto assets.
Carylyne Chan, chief strategy officer at CoinMarketCap, said that
“volume has lost its value as a metric.” “Today, we are introducing a new metric to highlight what matters most to investors and traders: liquidity. With our Liquidity metric, we hope to provide public good to the crypto markets by encouraging the provision of liquidity instead of the inflation of volumes.”
Chan further explained the firm’s aims with their methodology:
“We believe our adaptive methodology will make our metric very difficult to ‘game’ as orders would need to be placed close to the mid-price, or risk being counter-productive to the Liquidity metric scoring.”
Hopefully, this metric will reduce the negative remarks of CoinMarketCap.