LocalBitcoins, the peer-to-peer exchange that matches buyers and sellers of bitcoin in almost 250 countries, is under speculations of providing erroneous data. The network publishes the weekly volume data for every region where it has users. A closer look shows flaws in the data that calls into question the claims of regional adoption.
As analyzed, LocalBitcoins data framed increased volumes of crypto adoption in HongKong during the protests; however, a member of the city’s bitcoin community revealed to Coindesk that there was no increase in bitcoin awareness among the protestors. Also, Matt Ahlborg, a Researcher, reported that the volume spike in Hong Kong was produced by a single trader presenting roughly 30 transactions to move a significant, disclosed amount of bitcoin silently.
Veruscka Xavier Filgueira, LocalBitcoins spokeswoman, stated that some trading activity, especially for smaller amounts, can be and presumably is miscategorized in regional data. She also commented, “some volume variation may be driven by a particularly high volume trade or an exceptionally active period for a group of traders.”
As per the Ahlborg’s data analytics website, LocalBitcoins’ overall volume in Latin America dropped 6 percent from about $9 million to $8.5 million by October 20. In all, the region witnessed $32 million less volume over the past 90 days, contrasted to the prior 90-day span.
Furthermore, despite the introduction of KYC on the network, spokeswoman Filgueria stepped back to say whether the officials in the repressive regimes were using the platform.
Considering everything, it can be concluded following the evidence that regional volume data from exchanges do not substantially correlate to an ascending usage of the cryptocurrencies. Often, they may imply a whale or a single party circulating assets.