The liquid market is virtual in nature. There is no liquidity when withdrawals are disabled. You can buy 30M coins on Binance but you can't withdraw them.
You don't need liquid Steem to post a buy/sell order on Binance. It's all just numbers in their database. Not your keys, not your crypto.
Agreed. Your trading is just moving bits around in a database, and nothing is realized until there's a withdrawal. This is how some exchanges have been able to get away with posting bullshit volumes on CMC.
Unfortunately, wash trading will also be a thing on DEXes. Nothing stops me from trading with myself on any platform. :/