The Upbit Problem for Hive

tobetada(77)

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Good day Hiveians!

Join me in analyzing the crypto markets!

Hive has a centralization problem regarding its liquidity

Almost all of liquid Hive is on Upbit, the South Korean exchange. This wouldn't be a problem in itself if the exchange would be available to the world. But only South Koreans are allowed to tade on it. This means that Hive is basically stuck there if the people do not decide to transfer it to other exchanges or the internal market. Further, there are some big whales there who's only interest is to pump & dump Hive as we have just seen in the last week. These P&Ds have been there from the start and there is no reason to believe that they will stop. The only goal of those whales is to make more money - they do not care about Hive.

@edicted pointed out correctly that it would be super profitable to arbitrage Hive in reagrds to this:

Last year I noticed that almost all pumps occur at 00:00 UTC and originates in South Korea on Upbit. It's very clear in the chart I posted with it:

I concluded

While we can't answer the question of "who" is responsible for the pumps (and dumps) directly we know that it happens on Upbit. This is a Damocles sword in my opinion: we can be fairly certain that we get more Hive pumps in the future, but we also know that they won't really be sustainable until Hive is traded with greater volume on other exchanges .

Essentially, Hive will continue to see this volatility until liquid Hive is more evenly distributed on the exchanges and the internal market. Without access to Upbit, however, it's almost impossible to do this unless the whales there don't buy back the Hive they dump and/or Hive gets slowly withdrawn from Upbit. The frustrating part is, that we have absolutely no control over this and I guess we can try to make a shout out to all South Koreans on Hive:

"If you have access to Upbit, try to withdraw the Hive you have to another exchange"

If anybody has more ideas on how we could mitigate this problem, let me know in the comments!

As a general reminder: Please keep in mind that none of this is official investment advice! Crypto trading entails a great deal of risk; never spend money that you can't afford to lose!