KuCoin Shares (KCS) Boom, Sceptics Point to Inflated Volumes
KuCoin is suddenly showing growing exchange volumes, potentially competing with the level of Binance.
KuCoin Shares (KCS) is an anomaly right now, being one of the few stablecoins to rally in the past day as the rest of the market remained stagnant. KCS traded at $1.62, spiking slightly in the past few days. KCS has remained relatively stable in the past months, under 20,000 Satoshi and below $2, after crashing from its all-time peak near $20.
But even after a year of bearish downtrends and stagnation, KCS suddenly marked record volumes. KCS trading started to pick up in May, and has now reached more than $51 million. The purpose of KCS is to serve as a native exchange coin, to form trading pairs and distribute some of the earnings of KuCoin.
One of the reasons for the price spike of KCS is a recently announced coin locking and buyback program. The program allows users to lock their KCS, as a form of staking, and receive rewards. But there is also the option for KuCoin to buy back the coins at a price 10% off of the purchase price at the time of the lockdown.
But the buyback program was viewed with skepticism, as a way to boost an otherwise illiquid and relatively unpopular asset:
Traders noted that the buyback is also in KCS, not in Bitcoin (BTC) or any type of more valuable currency or asset. Thus, in effect, traders would simply receive more KCS to mitigate their risk.
KuCoin remains one of the relatively active exchanges and may go on to increase its influence. The exchange reports volumes above $733 million in 24 hours, a level on par with the larger market operators. KuCoin hosts 446 trading pairs, listing relatively obscure coins and tokens.
KuCoin is also considered one of the exchanges with relatively realistic trading volumes, although the recent activity spike for KCS remains suspicious. Still, volumes and activity have returned in the past two months, especially boosted by stablecoins and increased Asian exchange activity.