On Wednesday, October 23, Binance, the world’s largest cryptocurrency exchange, announced the removal of four digital assets from its platform, causing sharp drops in the prices of these currencies. Three of the four removed cryptocurrencies, Rupiah Token (IDRT), Keep3rV1 (KP3R), Ooki Protocol (OOKI) and Unifi Protocol DAO (UNFI), recorded significant drops of up to 40%, with Ooki Protocol standing out, which plummeted 43.5% in the last 24 hours.
Market impact
With the announced removal, the affected projects suffered severe losses, since much of their trading volume and liquidity was concentrated on Binance. UNFI and KP3R, for example, lost around 37% of their value, while IDRT, a more stable token, fell by only 0.4%.
This move has raised concerns among investors, especially since Binance is known for its strict policy on listing and delisting cryptocurrencies. The decision to delist these assets raises uncertainty, suggesting that there are deeper issues with the affected projects, such as difficulties in development or compliance with regulations.
Reasons for exclusion
Binance highlighted a number of factors that led to the delisting of these cryptocurrencies. Among the reasons given, the exchange mentioned:
•Lack of team commitment to the project;
•Low level of development;
•Lack of trading volume and liquidity;
•Security vulnerabilities and network instability;
•Inadequacy to new regulatory requirements.
These aspects raise suspicions that the projects may be facing serious difficulties, triggering the withdrawal from the platform and the consequent flight of investors.
Trading pairs also affected
In addition to the delisted cryptocurrencies, Binance also announced the delisting of four trading pairs: ALGO/FDUSD, CHR/ETH, DGB/BTC, and GMX/BTC. While the delisting of these pairs had less of an impact on the market, it serves as an indication that the related projects have been facing low demand. The cryptocurrencies involved, such as Algorand (ALGO) and DigiByte (DGB), saw moderate drops of up to 4.4%, in line with the bearish trend in the cryptocurrency market, which also follows Bitcoin's movement, which fell by 1% in the same period.
Future implications
The delisting of cryptocurrencies from a major exchange like Binance is always a cause for concern in the market, as many investors rely on the liquidity and visibility provided by these platforms to assess the value of projects. While the tokens can still be traded on other pairs or platforms, the delisting could signal the beginning of a broader downward trend.
For investors, Binance’s decision raises a red flag about the need for greater diligence when evaluating projects, especially those showing signs of stagnation or operational issues. While some may see these delistings as an opportunity to buy assets at lower prices, others may choose to stay away due to uncertainty.
This movement also reinforces the importance of brokers in shaping the crypto market, with decisions that have a direct impact on the value of assets and investor confidence.
