On June 4, CoinMarketCap recently introduced a new algorithm to rank exchanges, one of many changes planned to overhaul the exchanges ranking metric. However, Binance (which bought CoinMarketCap in April) remains at the top spot.
The new algorithm specifically takes into account new metrics introduced in late May - the exchanges’ spot market pair rankings and their respective confidence score. The top exchange gets a web traffic score of 1000, a reference point for the assessment for other exchanges. This has irked some.
Exchanges are compared to the top exchange. Source.
Carylyne Chan, the interim CEO of CoinMarketCap, saw this as a real step forward for the platform,
I believe this new ranking of exchanges will provide our users with an accurate reflection of the trading venues, as they are scored on a triage of factors that provide a complete picture. Our machine learning algorithm will improve and adapt to volume, liquidity and traffic changes over time.
Binance’s ranking as the number 1 exchange invited some criticism, with many insiders and community members pointing out a conflict of interest, including Huobi Group’s head of global markets Ciara Sun and OKEx CEO Jay Hao. However, CoinMarketCap says that it will introduce new features in the near future and that this new rollout is simply one of many changes towards a fairer assessment.
Binance has also been criticized recently for its new UP and DOWN tokens, which it says will ease liquidation risk and the nitty-gritty of managing a leveraged position.