How to check if trading volume is fake (on a DEX or an exchange)
Wash trading inflates volume so a token looks popular. Compare 24-hour volume with liquidity (dozens of times more volume than liquidity is a red flag), check whether the volume just mirrors another exchange, and watch for large orders that appear and disappear. None is proof alone; two together usually are.
How common it is
Wash trading means trading with yourself (or a friendly wallet) to create volume. On DEXs it is cheap, and it works: trending lists, screeners and bots rank by volume. Studies keep finding a lot of it.
Show as table
| Value | Note | |
|---|---|---|
| DEX pools manipulated by wash traders (Solidus Labs) | 67% | sample of about 30,000 pools |
| Volume faked on unregulated exchanges (Cong et al.) | 70% | upper estimate |
| Share of volume that was wash trading in those pools (Solidus) | 16% | a lower bound |
Check 1: volume against liquidity
On DexScreener or Birdeye, divide 24-hour volume by the pool's liquidity. Real trading rarely turns a pool over dozens of times a day for long; data firm Kaiko flags assets with volume above 100 times their order book depth as a possible sign of wash trading. Memes and low caps naturally run hot, so use it as a filter: very high ratio plus few unique traders is the pattern.
MemeSonar uses this check in its token score: a token whose volume is many times its liquidity gets a penalty, so it does not rank as "hot" just because a bot trades it back and forth.
Check 2: volume that copies another exchange
DefiLlama's 0xngmi showed that volume on one perp exchange started to mirror Binance perp volume almost exactly, with a ratio close to 1, while other exchanges looked nothing like it. Real users do not trade in perfect sync with another venue. Compare the hourly volume chart of a pair on two exchanges; if one is a near copy of the other, it is probably being farmed, often for points or a listing.
Check 3: walls that flicker (spoofing)
On centralised exchanges, watch the order book. Trader The White Whale described a sell order of about $200,000 on Bybit spot that kept flipping in and out of view, the classic sign of spoofing: an order placed to scare buyers and pulled before it can be filled. Large walls that move away as price approaches are not real supply.
Quick on-chain signs
- Few wallets, many trades. Hundreds of trades from a dozen wallets.
- Balanced buys and sells. The same wallets buy and sell almost the same amount; research flags differences under 5% between linked wallets.
- Round-trip funding. Trading wallets funded from the same source, often the deployer.
More on reading a token before buying: market cap, liquidity and slippage and pump and dumps.
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MemeSonar does this for you in real time: every new Solana token, every influencer call and every tracked wallet, scored and filtered for rugs.
Request accessNot financial advice. Numbers are measurements of past tokens and calls; meme coins are extremely risky and most go to zero.