meBinance changes approach to token listing
Research has shown that 80% of tokens listed on the Binance crypto exchange over the past six months lost value because their price was inflated at the time of trading, which negatively affects retail investors. The exchange plans to support small and medium-sized projects to counter this trend. Cryptocurrency exchange Binance has called on small and medium-sized projects to combat the trend of low liquidity and fully diluted value (FDV) of tokens. This move is aimed at supporting projects with sustainable business models and strong fundamentals, which should contribute to the development of the blockchain ecosystem and strengthen confidence in cryptocurrencies.
Binance's call comes shortly after the publication of a study by on-chain analyst Flow, in which he found that over the past six months, more than 80% of tokens added to Binance lost their value after listing on the platform. The only exceptions were a few projects - Dogwifhat (WIF), Memecoin (MEME), Jito (JTO), Jupiter (JUP) and Ordi (ORDI).
Flow noted that most new tokens on Binance are backed by venture capital, launched at high prices, but lack real users or a strong community. The market capitalization of such assets at the start of trading averages about $4.2 billion, and the maximum valuation reaches $11.7 billion.
Flow also emphasized that the current approach to token launches is unsustainable and discredits the crypto industry. He called for changes to prevent further abuse and long-term negative impacts on the industry. In response, the Binance research team noted that low circulating supply launches are becoming increasingly common in token projects that allocate a large portion of the token supply to future releases. That's why Binance plans to change its approach to token listings by inviting small and medium-sized projects to apply for listing programs like Launchpools and Megadrops.
