CoinMarketCap (CMC), CoinGecko, and similar websites are some of the most popular tools in the crypto world. You type in the name of a coin or token, and boom: a neat chart and a price staring back at you, often down to the penny. It feels pretty official, right? Like the price you see there is the price you would get if you bought or sold that token at this moment. The catch is that those prices aren’t as reliable as they seem. And if you’re not careful, you could make decisions (or even lose money) based on numbers that don’t tell the full story. Let’s walk through why these prices can mislead you and how you can protect yourself and your funds. How Aggregators Calculate Prices (And Why It’s Not Perfect) Sites like CoinMarketCap and CoinGecko don’t create prices out of thin air. They’re in a category called price aggregators: platforms that collect data from many different exchanges where the token is traded and calculate an average, often weighted by how much is being traded (volume). platforms that collect data from many different exchanges where the token is traded and calculate an average, often weighted by how much is being traded (volume). calculate an average calculate an average Sounds fair enough. However, they don’t always aggregate all exchanges, and not all exchanges show the same price at the same time. Why? Because of supply and demand, differences in liquidity, and even delays in how quickly the data is updated. For example, imagine a token that trades only once in a while, on a few small exchanges. If one person pays an unusually high price on a tiny exchange, that trade can distort the “average” price you see on CoinGecko or CMC. That doesn’t mean you could sell your tokens for that high price —there just isn’t enough real demand. The next batch of users may sell, and that will put the price down again. And sometimes exchanges themselves report incorrect data. Some even inflate trading activity with fake trades (called “wash trading”) to make a token look more popular and valuable than it really is. The result is that the price you see might look solid, but when you try to trade, you discover no one is willing to pay you that much. How to Spot Misleading Prices and Trade Smart So, how can you protect yourself? First, always check the trading volume. That’s the total amount of that token traded in 24 hours. If the volume is tiny, then the price is much less trustworthy because even a single trade can shift it significantly. However, even if the volume is high, don’t be fooled by it, as it can be easily faked. First, always check the trading volume. That’s the total amount of that token traded in 24 hours. Next, look at where the token is traded. If it’s only listed on obscure or suspicious exchanges, that’s a clear warning sign. Reliable exchanges tend to offer fairer pricing and better liquidity (which just means it’s easier to buy or sell without moving the price too much). Reliable exchanges Reliable exchanges Also, check the order book. That’s simply the list of current buy and sell offers on an exchange. If there are only a handful of low buy orders compared to the price you saw on CoinMarketCap, chances are you won’t get that high price when you sell. Another concept to understand is slippage: the difference between the last traded price and the price you actually get when the trade completes. On low-liquidity tokens, slippage can ruin what looked like a good deal before. If there are only a handful of low buy orders compared to the price you saw on CoinMarketCap, chances are you won’t get that high price when you sell. More advice More advice One more practical tip: if you’re testing a new token or a new exchange, start with a small amount. Don’t put your whole budget into your first trade. Try trading a very small sum just to confirm the process works and the price matches what you expected. Even on legitimate exchanges, mistakes happen, and on less trustworthy ones, those “mistakes” are sometimes deliberate. Don’t feel pressured to pick the first exchange you see. Compare prices on several platforms before you trade. Often, the best choice isn’t where the token seems cheapest, but where the market is healthier and safer to use. Often, the best choice isn’t where the token seems cheapest, but where the market is healthier and safer to use. In the Obyte ecosystem, the exchange to use will depend on the token you want to trade. In the DEX Oswap.io, for instance, you can safely trade 28 Obyte-compatible tokens, including WBTC, MATIC, BNB, USDC, and the recently added CITY Token. For the native coin of the network, GBYTE, there are decentralized and centralized options as well. Biconomy and NonKYC.io are the available centralized exchanges, and they have different requirements and slightly different prices. Don’t forget to do your own research! Obyte Obyte Oswap.io Oswap.io CITY Token CITY Token Biconomy Biconomy NonKYC.io NonKYC.io Featured Vector Image by Freepik Featured Vector Image by Freepik Freepik Freepik
