Correct.  It is essentially an elaborate bucket shop.  When you trade and win at a bucket shop you are not taking money from other traders but from the shop itself.  Just like in Vegas, if you win consistently they will shut down on you.  I believe they are involved in the trades themselves, that they are freezing coins that show them a loss and then letting bots walk them down.  They will be gone before the end of the year IMHO.  Everything I'm seeing right now at Poloniex I saw at Cryptsy.  Mark my words.  Jesse saw this over 100 years ago:

"As it was, it didn't take long for the bucket shops to get
sore  on  me  for  beating  them.  I'd  walk  in  and  plank  down  my 
margin, but they'd look at it without making a move to grab it.
They'd tell me there was nothing doing. That was the time they
got to calling me the Boy Plunger. I had to be changing brokers
all the time, going from one bucket shop to another. It got so
that  I  had  to  give  a  fictitious  name.  I'd  begin  light,  only 
fifteen  or  twenty  shares.  At  times,  when  they  got  suspicious, 
I'd  lose  on  purpose  at  first  and  then  sting  them  proper.  Of 
course  after  a  little  while  they'd  find  me  too  expensive  and 
they'd tell me to take myself and my business elsewhere and not
interfere with the owners' dividends.
   Once, when the big concern I'd been trading with for months
shut down on me I made up my mind to take a little more of their
money away from them. That bucket shop had branches all over the
city,  in  hotel  lobbies,  and  in  nearby  towns.  I  went  to  one  of 
the  hotel  branches  and  asked  the  manager  a  few  questions  and 
finally got to trading. But as soon as I played an active stock
my  especial  way  he  began  to  get  messages  from  the  head  office 
asking who it was that was operating. The manager told me what
they  asked  him  and  I  told  him  my  name  was  Edward  Robinson,  of 
Cambridge. He telephoned the glad news to the big chief. But the
other  end  wanted  to  know  what  I  looked  like.  When  the  manager 
told me that I said to him, "Tell him I am a short fat man with
dark hair and a bushy beard 1" But he described me instead, and
then he listened and his face got red and he hung up and told me
to beat it.
   "What did they say to you?" I asked him politely.
   "They said, `You blankety-blank fool, didn't we tell you to
take no business from Larry Livermore? And you deliberately let
him trim us out of $700!" He didn't say what else they told him.
   I tried the other branches one after another, but they all
got  to  know  me,  and  my  money  wasn't  any  good  in  any  of  their 
offices. I couldn't even go in to look at the quotations without
some of the clerks making cracks at me. I tried to get   
them  to  let  me  trade  at  long  intervals  by  dividing  my  visits 
among them all. But that didn't work."

"Everybody in the room heard me and began to look toward us
and  ask  what  was  the  trouble,  for,  you  see,  while  the 
Cosmopolitan  had  never  laid  down,  there  was  no  telling,  and  a 
run  on  a  bucket  shop  can  start  like  a  run  on  a  bank.  If  one 
customer  gets  suspicious  the  others  follow  suit.  So  Tom  looked 
sulky, but came over and marked my tickets "Closed at 103" and
shoved  the  seven  of  them  over  toward  me.  He  sure  had  a  sour 
face.
    Say,  the  distance  from  Tom's  place  to  the  cashier's  cage 
wasn't over eight feet. But I hadn't got to the cashier to get
my money when Dave Wyman by the ticker yelled excitedly
"Gosh! Sugar, 108!" But it was too late; so I just laughed and
called over to Tom, "It didn't work that time, did it, old boy?"
    Of  course,  it  was  a  put-up  job.  Henry  Williams  and  I  to-
gether were short six thousand shares of Sugar. That bucket shop
had  my  margin  and  Henry's,  and  there  may  have  been  a  lot  of 
other Sugar shorts in the office; possibly eight or ten thousand
shares in all. Suppose they had $20,000 in Sugar margins. That
was enough to pay the shop to thimblerig the market on the New
York Stock Exchange and wipe us out. In the old days whenever a
bucket shop found itself loaded with too many bulls on a certain
stock it was a common practice to get some broker to wash down
the  price  of  that  particular  stock  far  enough  to  wipe  out  all 
the customers that were long of it. This seldom cost the bucket
shop more than a couple of points on a few hundred shares, and
they made thousands of dollars.
    That  was  what  the  Cosmopolitan  did  to  get  me  and  Henry 
Williams and the other Sugar shorts. Their brokers in New York
ran up the price. Of course it fell right back, but Henry
and  a  lot  of  others  were  wiped  out.  Whenever  there  was  an 
unexplained  sharp  drop  which  was  followed  by  instant  recovery, 
the  newspapers  in  those  days  used  to  call  it  a  bucket-shop 
drive."

REMINISCENCES OF A STOCK OPERATOR

http://www.nowandfutures.com/large/Reminiscences_of_a_Stock_Operator_Jesse_Livermore.pdf