With the recent boom in the demand for cryptocurrencies, a certain set of firms
have enjoyed massive profits – the cryptocurrency exchanges. However, the rapidly
rising number of tokens on the market, including many fake ones, has made it very
tough for exchanges to choose the right coin to list for trading.
a recent analysis conducted by Dier regarding the performance of cryptocurrency
exchanges, Binance and Bittrex list better performing coins when directly compared to
HitBTC, Huobi, and OKEx.
According to the study’s findings, the inverse success ratio of new tokens generated
via an ICO is 27 percent for Bittrex and 38 percent for Binance, while for both Huobi
and OKEx, the ratio is 64 percent. HitBTC, which lists the maximum number of new
tokens, meanwhile has an inverse success ratio of 61 percent.
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Given the large amount of coins on the market, choosing the right one to list
can be like finding a needle in a haystack. This caused Binance to build a dedicated
team to review the coins that apply to be listed, the company’s CEO Changpeng Zhao
is quoted as having said in the study.
“Binance has a team that is dedicated exclusively to reviewing applications for new
tokens,” the text reads. “Mr. Zhao stressed that the sustainability of the project is very
important to Binance as they review the teams behind the project and their working history.”
Moreover, rising regulatory woes in countries like the USA has made it even tougher to
scrutinize the coins, as local regulations forbid exchanges from listing any ICO tokens
that can be considered as securities.
Earlier this month, the Securities and Exchange Commission (SEC) even issued a warning to
exchanges allowing the trading of such tokens, stressing that it sees this practice as the unregistered
offer and sale of securities.
Binance as well as Bittrex, which is currently the only exchange offering ICO tokens in the US,
consult with lawyers prior to listing any token to determine whether the digital asset is a security or not.
The tokens also need to pass their due diligence test which checks whether the project has an innovative use case.
“Bittrex uses a robust digital token review process to ensure the tokens listed on the exchange are compliant with U.S. law and are not considered securities,” the Dier report quoted a Bittrex representative as saying.