Binance listed two new meme coins, PNUT and ACT, causing their prices to surge by more than 2,000%. The move sparked controversy among experts, with some warning of the risk of market manipulation and losing out to small investors. Binance defended its decision, emphasizing its support for startups with active communities. Analysts expect more low-cap meme coins to be listed in the future.
ACT has surged over 2,400%, while PNUT has seen a surge of over 2,200% in the past seven days, according to CoinMarketCap data. This has sparked excitement among meme coin speculators.
Binance announced that trading in ACT and PNUT cryptocurrencies will be available on the ACT/USDT and PNUT/USDT trading pairs starting November 11. While users can start withdrawing the two currencies starting November 12.
ACT and PNUT are listed with the “Seed” tag, a designation given to cryptocurrencies that are typically in their early stages of development and may not yet have a working product or established user base. These coins are considered to have higher volatility and greater investment risk compared to other listed coins.
Despite the huge interest in listing ACT and PNUT, some regions, such as the United States, Canada, and the Netherlands, will not be able to trade these two coins on Binance. Local laws prohibit exchanges from offering these high-risk products to their citizens due to their vague (gambling) and speculative nature.
Criticisms and warnings from experts
While some traders are celebrating the new listing, some experts have sounded warnings about the impact of these listings on the market.
Leonidas, a cryptocurrency expert, noted that Binance has become a “pump and dump” engine, hurting retail investors and creating an unhealthy market for meme coins. Large investors, or “Bitcoin whales,” buy these coins when they are listed and quickly sell them, causing losses for smaller investors.
Leonidas explained that this strategy could lead to a short-term inflation of prices before they collapse later, exposing small investors to significant losses. He stressed the need for traders to be fully aware of the risks associated with investing in these currencies.
Economist Michael van de Poppe also added that the current trend of listing meme coins with small market caps poses a huge risk, as these coins are used to manipulate the market by large investors.
He advised traders to be careful and avoid investing in highly volatile currencies without careful study.
Binance surprises the market
Binance surprised everyone by listing low-cap coins like PNUT and ACT instead of billion-dollar meme coins.
Listing a coin on a large exchange like Binance usually costs a lot of money. But the market-leading centralized exchange has raised its listing fees to make the process smoother for new projects.
Unexpectedly, Binance has waived listing fees for PNUT and ACT, according to a post by the platform’s co-founder, Yi He, on the X platform.
This comes days after controversy over accusations of excessive fees being imposed on cryptocurrency projects.
It seems like Binance is taking a new approach that has resulted in ignoring high-cap coins and preferring to list smaller meme coins.
Binance also surpassed Neiro Ethereum in September (which was valued at over $250 million) in favor of First Neiro On Ethereum (which was valued at $15 million).
The platform argues that it lists these low-cap alternatives because they are more organic and community-controlled.
More organic cryptocurrency projects mean that these projects are built on a real and active user community. They rely heavily on community participation rather than advertising or paid promotion.
E-He stated that the aim of this approach is to support emerging projects with active communities. Binance seeks to provide an opportunity for these projects to establish themselves in the market.
This strategy raises questions about Binance’s priorities and whether it is simply a move to expand its user base and attract new traders or whether it is actually aimed at supporting innovation in the cryptocurrency space.
More low-cap meme coins expected to list
The listing of PNUT and ACT indicates that there is a huge opportunity for small-cap meme coins, with projects like Pepe Unchained and Crypto All-Stars being eyed as potential candidates for the next listing on Binance.
These projects rely on strong communities and seek to develop the infrastructure of digital currencies, such as the launch of the second layer of the Ethereum blockchain network, which promises to be 100 times faster and less expensive than the main network.
Some traders like CryptoBoy have predicted huge gains for these coins when they are listed on the platforms, suggesting that the Baby Unchained project could see a tenfold increase. In contrast, the Crypto All-Stars project is attracting increasing attention, as it aims to unite the different meme coin communities under one platform.
Baby Unchained is seeking to raise $27 million in a pre-sale to build a state-of-the-art meme infrastructure on the Ethereum layer 2 network, a move that aims to improve speed and lower transaction costs compared to the main network.
For his part, investment expert Ben Armstrong pointed out that the trend towards meme coins with strong communities represents a natural development in the digital market, as strong and supportive communities add real value to these projects, and make them less susceptible to manipulation compared to other currencies.
