Glossary - ChicksX

Wash Trade is a deceptive practice where a trader buys and sells the same asset to manipulate market activity.

Wash Trade is a form of market manipulation involving the simultaneous buying and selling of the same financial instrument. This creates misleading, artificial activity in the market. Traders engage in wash trading to inflate trading volumes or manipulate asset prices. This practice can mislead other market participants about the true demand or value of an asset. While it may temporarily boost interest in an asset, it's illegal in many jurisdictions due to its deceptive nature. Regulators monitor exchanges to detect and prevent wash trades, ensuring market integrity.