What this means? Why they do that? Is everything just done by exchanges or project itself,
I believe that it is a collaborative event between the exchange and the project, the project will be trying to make sure that they meet up to coinmarketcap cap requirements They thereby creating a fake volume by collaborating with the exchange and perhaps to draw the attention of investors to buy their token , lots of new exchange are guilty of this, and it doesn't speak good for cryptocurrency market generally
agree on these points. but if the project is already in cmc and you can still see that they are blatantly doing the wash trading. then be very careful with that coin, either they slowly want to discard the dev's coins for early exit or they want to pump the price so they can get a higher price value of their coin and later on sell whatever they have and boommm!!
you will see this kind of fake trading if you are closely following a coin and know basically whats going on. you dont have to be a rocket scientist to detect this kind of scheme. either the exchange or the dev team is benefiting on this situation!