The Biggest Problem Plaguing the Liquid Crypto Market Now Is the Complete Blackbox of How Projects and Market Makers Can Work Together

In an X post, Arthur Cheong, the founder of DeFinance Capital, states that there is a serious problem in the cryptocurrency market.

The founder of DeFIance Capital says there is a "huge problem" in the crypto market.

According to Arthur Cheong, project teams and market makers often work together secretly to manipulate token prices.

"The biggest problem now is the complete blackbox of how projects and market makers can work together to create an artificial price that can sustain for a very long period," he said. "You don't know whether the price is a result of organic demand & supply, or if it's a product of collusion and manipulation."

Price manipulation is a serious problem. If the price of a token is manipulated, it will be difficult to accurately analyze which exactly is influencing the market.

To make a sensible market decision, a trader or investor should possess a clear idea about the factors affecting that market.

"It's no secret that market makers can heavily influence token behavior, and in an attempt to control the narrative, they'll often spin a tale of "organic demand' to deceive those observing the price action," Arthur added.

According to him, this isn't the first time that this issue has been highlighted.

"It's been discussed in the past, but no one seems to be addressing it. This is allowing many low-quality assets to enter the altcoin market, and it's affecting the overall health of the ecosystem."

CEXs are showing no interest to address this market manipulation issue.

"It's interesting to note that the total market cap of cryptos other than the top ten has dropped by no fewer than 38.33% since the start of this year. During the period, the altcoin market cap has declined from $1.34T to $961.7B," noted Arthur.

In the last one year, as per data in coinraking, at least 12,799 new crypto tokens have been listed. In the last 30 days, at least 778 cryptos have entered the market. Today alone, at least nine new cryptocurrencies have been listed, including MAGABY, ModalAI, MeshChain AI and NILAM Resources – Mind Wave.

One of the most sensational token releases of the year happened in late January, when the Official Trump token was launched with an opening price of $6.54. Within hours after the launch, the price of the token skyrocketed to a peak of $72.62. Currently, the Official Trump price stands at $8.05. In the last 30 days, the market has slipped by 33%. In the last 24 hours alone, the market has declined by over 3.9%.