Hi all, we've deployed a change today to how the exchange nomination works. There are two major changes:
- We now auto-create a reddit discussion for each exchange nomination so the community can talk about the evidence of whether the exchange is trustworthy.
- Every new exchange nomination going forward requires an order book analysis for the community to review and adjudicate.
What is the OMC definition of a trustworthy exchange?
We think that a trustworthy exchange, to start, should have:
- Real volume of trades between two different parties
- Traders can easily withdraw their funds in a timely manner because the exchange is solvent.
To address real volume, we initially used the Bitwise report to determine the first ten trustworthy exchanges.
For subsequent exchanges, we've found that without a similar analysis, determining trustworthiness was a more difficult task. Hence, we've embarked on our own analysis, and now require exchange nominations to include an order book analysis. Not only will this focus the discussion on reddit, but will also be a concrete set of data for the OMC community to review.
What is an order book analysis?
The order book analysis required for every new exchange nomination is detailed in the participation guide. To start, we'll mirror the analysis inside of the Bitwise report, which focus on three specific analysis:
- Trade size histogram in the last 7 days
- Trade volume over time in the last 7 days
- The bid-ask spread over time in the last 7 days
What about the existing exchanges in challenge?
The existing nominated exchanges and in challenge as of 3pm PST Apr 3rd will not require an order book analysis. However, without ample evidence that an exchange is trustworthy, the community should default to rejecting an exchange as we would rather not have false positives.
This is still a work in progress, if you have ideas about looking at trustworthiness of exchanges, comment below.
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