Over 80% of the newly listed cryptocurrencies on Binance, the world’s largest digital asset exchange by trading volume, have declined in value.
In the past six months, these tokens have plunged in value since listing on the exchange, raising concerns for investors seeking out the latest cryptocurrencies.
Most New Binance Token Listings Trading in Red
According to a May 17 post by pseudonymous crypto researcher Flow on X, only five of the 31 tokens analyzed have appreciated in value: the meme coin (MEME), the Ordi token (ORDI), Solana-based Jupiter (JUP), Jito (JTO), and Dogwifhat (WIF).
Every one is talking about the VC + CEX cartel where teams are pushed to launch at the highest possible FDV on tier-1 CEX and provide exit liquidity for VC and insiders
The result: New coins are not great investment anymore
But how real is this? I crunched the number for you 👇
Despite lacking venture capitalist (VC) backing, the Ordi token was the most profitable, with an increase of over 261% since its launch. The controversial meme coin Dogwifhat followed in second place, surging more than 117%.
Flow noted that top-tier venture capitalists back most new Binance listings and launch at inflated valuations. The average fully diluted valuation (FDV) on the Binance listing date exceeds $4.2 billion, with some tokens reaching over $11 billion. Often, these projects lack real users or a strong community.
According to Flow, if investors had made equal investments in each of the new Binance listings over the past six months, their portfolio would have declined by over 18%. This, Flow adds, suggests that many tokens launching on Binance are not viable investment vehicles, as their upside potential is already exhausted. Instead, they are exit liquidity for insiders who exploit retail investors’ limited access to early investment opportunities.
Flow also criticized the current market dynamics, citing economist Alex Kruger’s earlier observations on X. Kruger noted that many tokens are designed to pump and then dump due to short vesting schedules, fake metrics, and a focus on hype rather than user acquisition.
New Token Launches Causing Market Harm
According to crypto researcher Flow, the current token launch meta is damaging to the crypto market, and a new approach to token launches is needed. Releasing tokens at high, fully diluted valuations (FDVs) leads to value erosion and minimal market interest, ultimately causing the token to plummet. He added that this approach not only harms the token but also discredits the entire crypto industry.
He highlighted an earlier post by Crypto_McKenna, who criticized the practice of pushing protocols to launch at high FDVs to benefit pre-seed and seed investors. McKenna noted that launching at a lower FDV allows secondary market traders to profit from repricing and helps generate momentum and interest.
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The Nigerian government has denied the allegations made by Binance’s CEO, Richard Teng, claiming that its officials demanded a $150 million bribe to settle the criminal charges against the crypto exchange.
In an official statement released on Wednesday, the Special Assistant to the Minister of Information and National Orientation, Rabiu Ibrahim, dismissed the claims as baseless.
A “Diversionary Tactic”
Ibrahim stated that the allegations were part of a coordinated effort by Binance to discredit the Nigerian government and divert attention away from the charges the company is currently facing in the country.
“This claim by Binance CEO lacks any iota of substance. It is nothing but a diversionary tactic and an attempted act of blackmail by a company desperate to obfuscate the grievous criminal charges it is facing in Nigeria. The facts of this matter remain that Binance is being investigated in Nigeria for allowing its platform to be used for money laundering, terrorism financing, and foreign exchange manipulation through illegal trading,” he said.
Earlier on Tuesday, Teng had published a blog post that called out the Nigerian government for unjustly detaining two Binance executives, Tigran Gambaryan and Nadeem Anjarwalla.
In the blog post, Teng claimed that Binance had been approached by unnamed Nigerian government officials who demanded to be secretly paid $150 million in cryptocurrency to halt investigations into the company’s activities. Teng urged the authorities to release Tigran Gambaryan, who had been detained for over 70 days.
Nigeria to Continue Criminal Case Against Binance
Continuing in his statement, Ibrahim stated that the government’s investigations will not be deterred by Binance’s claims, which he describes as “blackmail”.
“We would like to remind Binance that it will not clear its name in Nigeria by resorting to fictional claims and mudslinging media campaigns. The only way to resolve its issues will be by submitting itself to unobstructed investigation and judicial due process… The government of Nigeria will continue to act within its laws and international norms and will not succumb to any form of blackmail from any entity, local or foreign,” Ibrahim said.
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Binance users will have a chance to bag an allocation for EZ, the native token for liquid staking protocol Renzo.
According to an announcement, Binance Launchpool will list Renzo (EZ) as its 53rd project on April 30. The maximum supply is set at 10 billion tokens, and the platform will field 1.05 billion EZ coins as an initial supply.
In February, Binance, crypto’s largest centralized exchange, previously invested in the Renzo protocol. However, the monetary amount injected into the project remained undisclosed. The investment was made via Binance Labs, the venture capital arm of the exchange now operates as a standalone business.
At the time, Binance Labs was worth $10 billion and its portfolio supported over 250 crypto protocols, per details provided by the company.
Renzo tails Ether.fi in liquid restaking market
Following its mainnet launch in October last year, the Renzo protocol has grown into a major player in the Ethereum (ETH) liquid restaking market. DefiLlama data showed that users have deposited $3.39 billion into the defi platform.
With a 144% increase in the past month, Renzo is the second-largest liquid restaker on Ethereum. Only Ether.fi boasts a bigger user demand at $3.82 billion in total value locked.
Top liquid restaking protocols | DefiLlama
Liquid restaking protocols spun off EigenLayer, a platform that allows users to secure other chains and dapps by repurposing staked ETH. The initiative also provides an additional yield source for stakers and derivative tokens to improve on-chain utility.
While the sector is now valued at over $10 billion, experts are divided over the risks associated with liquid staking, with some arguing that it is overstated and others advising caution among participants.
Changpeng Zhao continues to lead Forbes’ list of cryptocurrency billionaires. How did he build his fortune?
Changpeng Zhao has remained one of the wealthiest people for several years, even with legal issues and billions in fines in 2023. In early April, Forbes updated its billionaire list, featuring 17 people from the cryptocurrency industry. Once again, the founder and former CEO of Binance topped the list with an estimated fortune of $47.7 billion.
Profiting from Binance’s success
In 2017, Changpeng Zhao launched Binance Coin (BNB), distributing $200 million in BNB. Since its launch, Binance Coin’s value has surged, with its price currently around $540. With a market capitalization of about $80 billion, BNB ranks as the fourth largest cryptocurrency.
Source: CoinMarketCap
After five rounds of funding, Changpeng Zhao acquired a significant but undisclosed portion of Binance, where $3 billion has been invested. As a result, his net worth was estimated at $100 billion in 2022.
Additionally, the exchange was actively engaged in acquisition. Zhao discussed this strategy in an April 2021 interview with Bloomberg.
“We plan to do somewhere between 20 and 30 acquisitions a year. Most are smaller acquisitions—we don’t announce them. Some will be bigger ones like CMC, but we do plan to do about 30 acquisitions each year, which probably means about three deals every month now.”
Changpeng Zhao, founder and former CEO of Binance
The statement refers to Changpeng Zhao’s early 2020 acquisition of a cryptocurrency data tracking site, though the purchase price was not revealed. Zhao stated that this move aimed to diversify Binance’s business.
According to Business of Apps, Binance has made substantial profits, reporting annual revenues of approximately $5.5 billion in 2020, $20 billion in 2021, and $12 billion in 2022.
However, the previously unregulated growth of both the broader crypto industry and Binance ended in 2023. Starting with a 55% market share, Binance experienced a decline in on-chain activities, which led to decreased reserves and trading volumes. Regulatory issues caused its market share to drop to 32%, though it recovered to 48% by January.
Due to legal issues, the company’s value decreased, reducing Zhao’s net worth to $40 billion. After resigning as CEO of Binance, CZ agreed to pay a $50 million fine, and the company offered to pay $4.3 billion in fines and compensation. However, Zhao’s control over the company remains unchanged unless he sells most of his stake.
Zhao’s other assets and investments
Most of Changpeng Zhao’s wealth comes from his ownership in Binance and his investments in BNB and BTC cryptocurrencies. Besides these, he also owns other assets.
Real estate
Changpeng Zhao owns at least two properties in Dubai, a city he admires for being “very pro-cryptocentric.” The crypto billionaire praised Dubai for its favorable business environment and bought property there as a sign of his commitment to the city. This is a change from his past stance, as he once mentioned that he avoided owning cars or real estate because he considered them too illiquid.
FTX and Twitter
Changpeng Zhao’s investments outside Bitcoin, BNB, and Binance have yet to be discovered. However, in 2019, he invested in rival cryptocurrency exchange FTX, founded by notorious fraudster Sam Bankman-Fried, who was once one of the wealthiest and most famous crypto entrepreneurs but is now in prison awaiting sentencing on fraud charges.
Changpeng Zhao left FTX in 2021, cashing out $2.1 billion, which proved wise as FTX collapsed in 2022, impacting the entire cryptocurrency industry.
He also invested $500 million in Elon Musk’s $44 billion acquisition of Twitter, not as a personal investment but as a corporate strategy.
In a November 2021 interview with Associated Press, Zhao said that most of his wealth is in cryptocurrencies, specifically Bitcoin and BNB. If he retained these assets through 2023, he likely profited towards the year’s end as the cryptocurrency market began recovering from a downturn, and Bitcoin’s value surged.
Financial struggles due to SEC
In June 2023, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance, accusing the company of bypassing regulations that prohibited U.S. users from accessing its services. The SEC also claimed that Binance lacked proper anti-money laundering measures, inflated its trading volumes, and mishandled client assets. Binance disagreed with the accusations and disputed them in court.
As a result, the Bloomberg Wealth Index slashed the value of Binance.US to zero in June 2023 after it announced it would no longer transact in dollars, sharply reducing trading volumes. Before this, Binance.US was valued at $4.7 billion in March 2022, and Changpeng Zhao’s (CZ) net worth had reached a high of $96 billion in January of the same year. His wealth then plummeted by 82% at one point.
By October 2023, Bloomberg reported that tightening regulations in the crypto industry and a market downturn had further reduced CZ’s fortune to $17.2 billion.
Restoring Zhao’s wealth
By the end of 2023, Zhao’s capital rose like a phoenix. Bloomberg journalists said at the end of last year that the estimated personal capital of the founder and former head of Binance increased to $37.2 billion amid the recovery of the cryptocurrency market.
This amount is still below his January 2022 peak of $96.6 billion and just above the $50 billion he had in June. However, CZ’s wealth increased by almost $25 billion since January. This growth is more than five times the $4.3 billion that Binance agreed to pay in a settlement with the U.S. Department of Justice in November.
In determining CZ’s wealth, Bloomberg experts relied on his 90% stake in Binance and 86% of the shares of the American division of Binance.US. The entrepreneur also announced investments in Bitcoin and BNB. However, their amount is unknown and needs to be included in the overall figure. The confidence rating in the accuracy of his capital assessment is at the lowest level.
Unknown profit of a known exchange
While the exact profits and assets of Binance’s founder, Changpeng Zhao, are not publicly disclosed, he is widely regarded as the wealthiest person in the cryptocurrency industry. Despite Binance’s financial details being largely private, the exchange commands nearly 50% of the market share, suggesting its profits could far exceed those of its competitors. As the owner of the company’s largest share, Zhao would benefit significantly from Binance’s success.
Moreover, the cryptocurrency market’s recovery typically favors all industry players. Although Binance has not released recent profit figures amidst the market’s upswing, it’s reasonable to assume that Zhao’s wealth has not only been preserved but has also grown due to the increase in market share, Bitcoin, and the overall capitalization of digital assets.
Binance will introduce new perpetual contracts with high-leverage options, enhancing its futures trading platform.
Despite these additions, the involved cryptocurrencies face declines in a generally falling market.
What’s New?
The world’s largest cryptocurrency exchange will expand the list of trading options offered on Binance Futures to enhance users’ experience. It will launch the ARB/USDC and NEO/USDC perpetual contracts with up to 50x leverage, while FIL/USDC will allow up to 75x leverage. The three choices will be available to traders from April 18.
Binance warned that it may adjust the specifications of the upcoming options, including the funding fee, tick size, maximum leverage, and initial margin, “based on marker risk conditions.”
The company will also activate the multi-assets mode on the those perpetual contracts, allowing clients to use cryptocurrencies like Bitcoin (BTC) as a margin.
Despite the additional support toward Arbitrum, NEO, and Filecoin, the affected assets remain in red territory amid a severe market decline. ARB is down 8% for the day, NEO has retraced by 13%, while FIL has lost around 6% of its valuation.
Binance’s Previous Amendments
The firm has made numerous similar changes and updates to its platform in the past several months. It delisted the popular privacy coin Monero (XMR) and three other altcoins – Aragon (ANT), Multichain (MULTI), and Vai (VAI) in March. On the other hand, it added Filecoin (FIL), NEAR Protocol (NEAR), Stellar (XLM), EOS (EOS), Injective (INJ), and Alien Worlds (TLM) as new loanable assets on Binance Loans.
Earlier this month, the exchange opened trading and enabled Spot Algo Orders Trading Bots services for the USDT/MXN pair.
Shortly after, it included 18 new loanable assets, such as dogwifhat (WIF) and Pepe (PEPE), Hedera (HBAR), IOTA (IOTA), and Celestia (TIA) to Binance Loans, whereas Saga (SAGA) and Tensor (TNSR) were added to its VIP Loan section.
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Binance has appointed a board of directors for the first time as regulatory crackdown intensifies.
The newly formed board will be chaired by Gabriel Abed, previously Barbados’ ambassador to the United Arab Emirates. The board comprises seven members, including Binance CEO Richard Teng and other key executives such as Heina Chen, Jinkai He, and Lilai Wang, who were among the platform’s founding members.
Additionally, two external members, Arnaud Ventura, a managing partner at Gojo & Co., and Xin Wang, CEO of Bayview Acquisition Corp., will join the board. The development was officially confirmed on March 7, as reported by Bloomberg.
This strategic move marks one of the initial significant changes under the leadership of Teng, who took the role in November. The exchange, yet to declare a fixed location for its global headquarters, views the formation of this board as a critical step in its ongoing transformation and compliance efforts.
The largest crypto exchange has been under significant regulatory scrutiny lately. Following its criminal charges and $4 billion settlement in the U.S., the exchange has been under a microscope in other regions like Nigeria and the Philippines. Most recently, the Philippines SEC has made efforts to block the exchange, citing non-compliance with licensing requirements.
Popular crypto analyst Xremlin, known on social platforms as @0x_gremlin, told his 104,000 followers that the altcoin season in 2024 could eclipse the monumental gains seen in 2021. Reflecting on the historical significance of major exchange listings, Xremlin emphasized, “Altseason 2024 > Altseason 2021. Your bags are headed to Valhalla.”
During the 2021 altseason, altcoins such as Polygon (MATIC) and Solana (SOL) saw a staggering 300x increase, largely attributed to listings on Tier-1 centralized exchanges (CEXs) like Binance and Coinbase, according to him. “MATIC and SOL’s 300x was fueled by Tier-1 CEX listings. Binance/Coinbase listings = Billions in retail liquidity,” the crypto analyst remarked.
The core of Xremlin’s analysis hinges on the demonstrable impact that listings on premier exchanges such as Binance and Coinbase have on the valuation of cryptocurrencies. According to the analyst, “These 8 altcoins [are] likely to be tradable there next → Pump by 10-50x,” highlighting the potential for immediate and substantial price increases.
Listings often trigger price surges ranging from 3 to 10 times the pre-listing value, primarily due to the vast user bases of these platforms engaging with the newly available tokens. Xremlin further elucidated the critical role of liquidity for the long-term success of a cryptocurrency project, stating, “In the long run, having access to billions in liquidity is crucial for a project’s success.”
Impact of Binance listing on price | Source: X @0x_gremlin
This perspective underlines the strategic advantage gained from being listed on Tier 1 centralized exchanges (CEXs). Xremlin has identified eight altcoins that not only show promise of being listed on such exchanges but also possess the potential for dramatic value appreciation. Here’s a detailed look at the altcoins spotlighted by Xremlin:
Top 8 Altcoins Not Listed On Tier-1 Crypto Exchanges
NGL (ENTANGLE): Operating as an omnichain infrastructure, Entanglefi aims to revolutionize data provision to smart contracts across any blockchain. With a current market cap of $232 million and trading at $1.96, its position as a Layer 1 (L1) protocol underscores its foundational potential in the blockchain ecosystem.
ALPH (ALEPHIUM): Priced at $2.75 with a market cap of $203 million, Alephium stands out as a Layer 1 blockchain solution tackling the critical issues of accessibility, scalability, and security faced by decentralized applications (dApps), according to the crypto analyst.
NORMIE: As a memecoin designed for mainstream appeal, Normie carries a market valuation of $120 million, with its price at $0.1237. Notably, Normie is based on Coinase’s Base protocol, which is speculated to be ready to replicate the success of the Solana memcoin craze.
CPOOL (CLEARPOOL): Clearpool distinguishes itself as a decentralized credit marketplace in the real-world-asset (RWA) sector focused on providing single borrower liquidity pools for institutional borrowers. It is currently valued at $140 million, with its tokens trading at $0.30.
BALLZ (WOLFWIFBALLZ): Inspired by a daring wolf, this memecoin is trading at $0.045 with a market cap of $45 million. BALLZ is trying to ride the wave of success of Solana memcoins, especially Dogwifhat (WIF).
IXS (IX SWAP): Ix Swap offers a secure platform for the trading of real-world assets and security tokens, supported by licensed custodians and broker-dealers. With a market cap of $140 million and a current price of $0.8425.
DEGEN: Another meme-centric token, Degen also operates on the Base chain and is currently priced at $0.01696, boasting a market cap of $211 million. Its appeal lies in the vibrant culture of crypto enthusiasts who identify with the “degen” lifestyle.
NMT (NETMIND): Netmind leverages blockchain technology to decentralize computing power for AI models globally. With a price of $6.96 and a market cap of $240 million, it aims to embody the cutting-edge intersection of artificial intelligence and blockchain.
At press time, @0x_gremlin’s top pick NGL traded at $1.87.
Featured image created with DALL·E, chart from TradingView.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Binance adds 17 altcoins as new loanable assets, offering users greater flexibility and the potential for Real-Time APR rewards through its Binance Loans (Flexible Rate) product.
The exchange will also delist certain cryptocurrencies, reflecting its ongoing commitment to high standards and operational adjustments in response to network demands.
The world’s largest cryptocurrency exchange continues with the amendments to its platform to provide a better user experience.
Most recently, it added the popular meme coin Floki Inu (FLOKI) and 16 other altcoins as new loanable assets on Binance Loans. Some of those include Algorand (ALGO), ApeCoin (APE), Maker (MKR), Stacks (STX), Neo (NEO), and more.
Binance Loans (Flexible Rate) is a product that enables users to complete loan orders while collateralizing cryptocurrencies in existing Simple Earn Flexible Products subscriptions.
“Users may enjoy greater flexibility without committing to a specific loan term when borrowing cryptocurrencies on Binance Loans (Flexible Rate) and earn Real-Time APR rewards via Simple Earn Flexible Products at the same time. Loan rates are refreshed every minute, and users may place a loan order with a minimum of 1 USDT equivalent,” the firm explains.
Binance also increased the number of trading pairs offered on Binance Spot by adding AAVE/TRY, ARKM/FDUSD, CRV/TRY, FET/BRL, RAY/FDUSD, and RNDR/EUR. These will be available to users from March 21.
The company launched a delisting effort, too, saying it will terminate services with DREP (DREP), Mobilecoin (MOB), and pNetwork (PNT) on April 3. It did not provide an exact reason behind its decision, reminding that it conducts periodic reviews on all digital assets and removes some when not meeting “a high level of standard and industry requirements.”
Earlier this month, Binance embraced PEPE/FDUSD, UNI/FDUSD, OM/TRY, PIXEL/USDC, STRK/USDC, and THETA/TRY and temporarily halted Solana (SOL) withdrawals due to “the increased volume of transactions on the network.” The service was supposed to be restored by March 9.
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Binance has cleared its personnel from the allegations surrounding Book of Meme (BOME), a meme coin built on the Solana blockchain.
The move follows widespread discussions and allegations of possible insider trading associated with the “BOME rat warehouse” incident, prompting Binance to take swift action to address the matter.
Binance Responds to Allegations
In an official statement released on X, the exchange emphasized its commitment to maintaining transparency and fairness within the cryptocurrency market and assured users that the integrity of trading activities remains a top priority.
According to the statement, preliminary investigation results suggest that the individual implicated in the allegations has no affiliation with Binance. However, the exchange reiterated its dedication to thoroughly examining the matter to ensure the accuracy of the findings.
Binance also expressed gratitude for the community’s vigilance and pledged to continue investigating the issue to uphold market fairness. To encourage reporting of potential misconduct, it also announced rewards ranging from $100,000 to $5 million for reports involving currency listing and other forms of corruption.
The controversy arose as Binance announced its decision to list BOME, offering spot trading pairs including BOME/BTC, BOME/USDT, BOME/FDUSD, and BOME/TRY, which took effect on March 16. Additionally, Binance introduced the USDS-M BOME Perpetual Contract on its Futures platform, offering leverage options up to 50 times.
BOME Surges Amidst “Rat Warehouse” Controversy
Following the listing announcement, BOME experienced a huge rise, with its value surging by 345% on March 16 alone, reaching $0.02703. Trading volume also increased, soaring by 262% to $3.8 billion, pushing BOME into the ranks of the most traded cryptocurrencies, with the meme coin coming in ninth place.
The term “rat warehouse” concerning Binance stems from discussions and controversies surrounding potential insider trading or information leaks within the platform, particularly concerning the listing of new tokens.
Previous listing events on Binance, such as RONIN and BLUR, have demonstrated considerable volatility in token prices post-listing. RONIN witnessed a significant decline, whereas BLUR experienced a surge. These events fueled speculation regarding the potential price action of BOME following its listing on Binance.
Describing itself as “an experimental project that is preparing to redefine the Web3 culture,” Book of Meme (BOME) is a Solana-based meme coin that aims to unite the ever-evolving meme culture within a digital “Meme book” preserved on the blockchain.
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Binance, the world’s leading crypto exchange by trading volume, appears to have spun off its venture capital and incubation arm, Binance Labs, as indicated on the latter’s website.
This move occurred earlier this year, marking a significant development during CEO Richard Teng’s four-month tenure.
Binance Labs Distances From Binance
Binance Labs’s website now clearly states that it operates independently and is not a part of the Binance Group, nor is it involved in any of the activities conducted by the latter, including the cryptocurrency exchange.
Based on records from the Internet Archive, the change appears to have occurred between February 19 and February 24.
Contracts for staff at Binance Labs are now different from those of employees at the crypto exchange, mirroring the structure of the Binance-backed BNB Chain project. Despite these adjustments, minimal operational changes are anticipated.
Although the reasons behind this restructuring remain undisclosed, Alex Odagiu, Investment Director at Binance Labs, emphasized that the entity has severed its ties with the broader Binance group. However, it will maintain its licensing agreement to utilize the Binance brand.
Despite these organizational changes, Binance Labs remains active in its operations. Last month, the platform invested in Babylon, a Bitcoin staking protocol pioneering native BTC staking for PoS blockchains. It enables users to stake BTC and earn yields without relying on third-party custody, bridge solutions, or wrapping services.
Additionally, Binance Labs incubated three projects: Ethena Labs, which focuses on Ethereum derivatives; NFPrompt, an AI-driven User Generated Content (UGC) platform for Web3 creators; and Shogu.fi, a protocol optimizing trader extractable value (TEV) through intent-driven processes.
Binance’s Legal Woes Continue
Since November, Binance has faced intense scrutiny after agreeing to pay over $4 billion in fines to U.S. regulatory agencies, one of the largest settlements in U.S. corporate history.
The Securities and Exchange Commission (SEC) lawsuit against Binance, Binance.US, and its then-CEO CZ (Changpeng Zhao) remains unresolved, with the motion to dismiss the lawsuit still contested.
The SEC is strengthening its case with supplemental authority from various lawsuits, including a class action against Binance, to deny the dismissal of the lawsuit. However, Judge Amy Berman Jackson recently ordered the court not to entertain discussions or elaborate on the supplemental authority presented by the parties in their arguments.
Following the lawsuit, CZ resigned shortly after pleading guilty to willfully violating the Bank Secrecy Act. Richard Teng, Binance’s former Global Head of Regional Markets, assumed the CEO role in the same month.
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The SEC’s lawsuit against Binance has been ongoing since June when the regulator served a lawsuit to Coinbase as well.
The proceedings have had their ups and downs. Since then, the main Binance exchange has settled with the SEC when Binance Holdings Ltd was asked to pay fines adding up to $4.3 billion, and former CEO Changpeng Zhao was forced to step down. CZ is currently out on bond – although he is obligated to remain in the US – until his sentencing.
Allegations of Obscurantism
However, Binance.US, legally known as BAM Trading Services, is still grappling with the SEC in court. After previous requests for intervention, the Washington D.C. court, in which the case is being judged, directed the two parties to work together on the discovery process. In a joint report submitted yesterday, the SEC alleges that the two sides have met an impasse.
According to the watchdog, Binance.US relented in its objections to providing agency representatives with an inspection of its in-house software. However, the SEC claims that the tour was scripted and did not provide any real insights into their inner workings.
“Despite multiple meet and confers concerning its scope and process, BAM refused to conduct anything more than an unrecorded, mostly choreographed tour of certain relevant software and infrastructure relevant to its Customer Assets. BAM’s counsel also refused the SEC’s requests to review different components of BAM’s software and then refused to answer several questions SEC counsel raised during the inspection.”
The SEC continues by stating that it now doubts that BAM holds exclusive access to private keys.
“BAM witnesses have testified that BHL established and still retains custody of the private keys to these wallets in an Amazon Web Services environment that hosts BHL’s servers and wallet software for BAM’s wallets and that BAM had no access to the AWS environment, servers, or software.”
However, the SEC admitted that BAM had indeed remained cooperative overall, supplementing its answers whenever necessary.
Binance.US Denies Allegations
When grilled on the subject, representatives of Binance.US stated that they had provided answers to all of the SEC’s requests, even when they had been “exceptionally broad.”
According to BAM’s legal team, they had already gone above and beyond their obligations as an institution and had simply declined to offer information on trade secrets that in no way affected the ownership of customer assets.
The information provided by Binance.US allegedly includes thousands of pages of documents, monthly reports, declarations under oath, and inspections of custody devices.
BAM therefore requests an end to the discovery process, which would allow the court to proceed with a decision regarding BAM’s affairs eventually.
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Blum, a crypto trading app that merges CEX and DEX facilities for a new trading experience, launched to over 50,000 signups in its first 48 hours.
A group of Binance alumni announced the hybrid crypto exchange in a push to introduce an improved trading experience for new digital participants and veterans alike. The platform is backed by Binance Labs for its seventh cohort and was picked as one of 13 protocols out of more than 700 projects from around the globe.
Blum promises to deliver a novel off-chain order book with on-chain settlement, allowing cryptocurrency trading on centralized or decentralized exchanges. The tokens will be automatically listed if sufficient liquidity exists. The startup plans to achieve this universal token access by pulling data from trusted protocols and platforms.
The hybrid crypto trading app will also support trading from mobile devices via a Telegram mini app, hopping on a growing trend of crypto trading on the private messaging social network. Users can switch between centralized and self-custody options, allowing traders to utilize popular wallet solutions like MetaMask.
Blum eyes Asian market, Georgian crypto license
Gleb Kostarev, a former Binance vice president, is Blum’s co-founder and CEO. Kostarev resigned from the crypto giant in September last year as the exchange planned its exit from Russian markets, after acting as Binance’s head of Asia and overseeing more than 60 markets including APAC, Eastern Europe, and Turkey since 2018.
Vladimir Smerkis, the ex-general manager for Binance Russia and CIS, is also a Blum official. Smerkis left Binance the same week as Kostarev and now serves as Blum’s chief marketing officer and co-founder. Vladimir Maslyakov, CTO of Thekey.space, is also a part of the project, per Kostarev’s Telegram announcement.
The platform said it will share details on its core team members later.
🚀 Exciting news! The time has come to unveil what my team and I have been tirelessly working on. Introducing Blum, a hybrid exchange revolutionizing the way you trade.
Blum is currently exploring potential regions for its headquarters and will target jurisdictions known for crypto-friendly regulations like Dubai, the platform told crypto.news. The hybrid exchange plans to build a global presence with an emphasis on emerging markets like Asia, particularly central and southeast regions in the continent.
However, the crypto trading venue decided against catering to U.S. customers due to the intricate regulatory landscape in that jurisdiction. Still, the platform intends to fully comply with international crypto legislation amid concerns over crypto’s status as a security or not.
Blum’s initial endeavors are focused on securing a Virtual Asset Service Provider (VASP) registration in Georgia by the first quarter of 2024. Georgia’s accommodating regulatory environment for cryptocurrencies positions it as a strategic launchpad within our target region.
Blum spokesperson
The firm also said that it may launch a native exchange token in the future, albeit with a distinct strategy from that of Binance. According to a company representative who spoke with crypto.news, the idea is to develop a blockchain tailored specifically for order book DEXs, with the chance of Blum serving as the native token within this ecosystem.
Our initial rollout phase introduces a system where users can accumulate points through engagements within the Telegram mini-app and forthcoming mobile applications. These accrued points hold the potential for conversion into tokens at a later stage
Blum spokesperson
Points are fast becoming a staple feature among crypto startups aiming to bootstrap community activity and garner users. The trend incentivizes users to interact with a protocol and accumulate internal capital through actions like transactions.
The hybrid crypto trading app is not the only startup built by exchange alumni, as ex-Alameda and FTX employees raised $17 million at a $120 million valuation last month for a platform dubbed Backpack as experts look to claim business share from industry stalwarts and service burgeoning markets.
Binance Holdings Ltd. has been ordered to pay $4.3 billion for a plea deal approved by District Judge Richard Jones, marking one of the heftiest criminal penalties in U.S. history.
The settlement follows Binance, the world’s largest crypto exchange, and its founder, Changpeng Zhao, pleading guilty to charges of anti-money laundering and sanctions violations, including transactions with Hamas and other terrorist groups.
The agreement, announced in Seattle, also mandates up to five years of compliance monitoring by an independent firm, yet to be appointed, potentially by New York-based law firm Sullivan & Cromwell.
“This really is a case where the ethics of the company were compromised by greed,” Judge Jones said, emphasizing the deliberate misconduct led by senior executives.
With “hundreds of millions of dollars of collateral consequences,” prosecutors highlighted the role of Binance in leaving the financial system susceptible to exploitation.
“We’re also proud of the compliance enhancements” that have been implemented over the past several years, expressed Josh Eaton, Binance’s deputy general counsel, to the judge. He emphasized that the company accepts full responsibility for its past and why the company is where it is.
Judge Jones pointed out Binance’s calculated decisions to disregard U.S. laws despite being aware of their applicability, underlining the sentence’s aim to deter similar future conduct by Binance and other entities and protect customers.
Zhao is set for sentencing in April, facing no more than 18 months in prison as per the plea agreement, which also required him to step down as CEO of Binance and pay a $50 million fine.
One of the biggest crypto exchanges in the industry, Binance, delisted Monero (XMR), a popular privacy-focused coin, triggering a substantial price drop and trading volume right after the announcement.
Shortly after, Monero reassured users that they would never compromise on privacy. The main reason for the delisting is likely that Monero uses stealth addresses, while Binance requires deposits from publicly transparent addresses.
Monero will never compromise on privacy.
You can trade Monero on other exchanges, on DEXs, and with atomic swaps. Please self-custody your XMR. https://t.co/Uba3GwZMRW
The announcement wasn’t taken lightly, sparking rumors and backlash on Crypto Twitter. Several users, influencers, and even institutions criticized the move or think Binance is knuckling under US regulations. Funny enough, the announcement came a day after Treasury Secretary Janet Yellen called for cryptocurrency regulations, especially for stablecoins.
XMR’s price sharply declined in the following hours, dropping 32%. At press time, XMR is trading below $115, according to data from Coinmarketcap. These lows have not been seen since mid-September 2023.
High-Level Standards
The Binance Customer Support team jumped into the discussion and assisted users’ commentaries and concerns, but instead of addressing the questions individually, they provided a single copy/pasted response for all users, which didn’t sit well for them.
Hi there. At Binance, we periodically review each digital asset we list to ensure that it continues to meet the high level of standard we expect. When a coin or token no longer meets this standard, or the industry changes, we conduct a more in-depth review and potentially delist it.
Hi there. At Binance, we periodically review each digital asset we list to ensure that it continues to meet the high level of standard we expect. When a coin or token no longer meets this standard, or the industry changes, we conduct a more in-depth review and potentially delist…
Despite Changpeng Zhao resigning and pleading guilty to violating Anti-Money Laundering and sanctions laws in the US in late 2023, Binance is subject to five years of surveillance, monitoring, and heavy compliance with US regulators as part of a settlement agreement.
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Binance, the world’s largest crypto trading platform, has announced the launch of a marketplace for inscription tokens to facilitate the buying, selling, and minting of a wide range of such assets.
According to a press release seen by CryptoPotato, the Binance Inscriptions Marketplace leverages the application programming interface (API) of UniSat, a Bitcoin inscriptions market and wallet provider, and is hosted within the Binance Web3 Wallet.
Binance Launches Inscriptions Marketplace
Inscription tokens are fungible assets that can be used to store digital artifacts and non-fungible tokens (NFTs) created on blockchains. The artifacts include data like texts and images.
Inscriptions became popular in 2023 after the launch of the Ordinals protocol on the Bitcoin blockchain. A Binance study found that inscriptions minting volumes significantly rose after BRC-20 tokens were conceptualized last year. This has made BRC-20 tokens one of the most popular within the crypto space.
The Binance Inscriptions Marketplace gives users access to various features for exploring the world of inscription tokens, including BRC-20 and Ethereum Virtual Machine (EVM) assets. Users can move inscriptions between the Binance trading platform and its Web3 Wallet and execute transactions powered by the Bitcoin Transaction Accelerator.
Commenting on the marketplace launch, Rohit Wad, Chief Technology Officer at Binance, said: “Our partnerships with industry leaders enable us to drive these innovations faster, blending convenience with cutting-edge technology for all users.
With the Binance Inscriptions Marketplace, we hope to support the industry by providing a one-stop gateway for more people to explore, experiment, and benefit from inscription tokens. Our hope is that the streamlined process would make the experience simpler and more enjoyable for everyone.”
Binance Inscriptions Marketplace to Leverage UniSat API
Binance revealed that leveraging UniSat’s API would help facilitate users’ entry into the inscriptions space, as the wallet provider has access to a liquidity depth of more than 60,000 BRC-20 tokens. Binance’s latest product would benefit from UniSat’s extensive token offering and the convenience and security of the Binance Web3 Wallet.
“Binance’s dedicated commitment toward innovation aligns with our own vision to fuel positive industry growth. At UniSat, we believe that inscription assets hold immense potential for the future. Our hope is that this significant step by Binance, as a supporter of inscriptions, will inspire more developers and fellow crypto enthusiasts to explore this exciting field,” said UniSat director Lorenzo.
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According to a recent CoinGecko report, Binance, the world’s largest centralized exchange (CEX) by trading volume, has retained its market leadership position in 2023.
Despite facing increased regulatory scrutiny and undergoing significant leadership changes, Binance maintained a market share of 43.7% and saw its spot trading volume rise to $427.1 billion in December 2023, representing a 37.5% month-on-month (MoM) increase.
Binance Trading Volume Reached $3.8 Trillion In 2023
According to CoinGecko’s report, Binance started the year with a commanding 63.5% market share but experienced a gradual decline throughout 2023, ending with a 43.7% market share in December.
While Binance still dominated the market with 52.6% of the total spot trading volume in 2023, the exchange’s relative market share decline was notable. In absolute terms, Binance generated $3.8 trillion in trading volume throughout the year.
Total trading volume of the top 10 DEXs in 2023. Source: CoinGecko
As previously reported, Binance faced significant regulatory pressure throughout 2023, culminating in a settlement agreement in November that required the exchange to pay a $4.3 billion fine to the Department of Justice (DOJ) and the Commodity Futures Trading Commission (CTFC) for alleged financial breaches.
As part of the settlement, Binance’s CEO, Changpeng Zhao (CZ), also agreed to step down. Richard Teng has assumed the role of the company’s head, while CZ remains restricted from traveling outside the jurisdiction of the United States as the legal battle unfolds.
Upbit And OKX Follow Closely
Upbit, South Korea’s largest cryptocurrency exchange, managed to maintain its position as the second-largest centralized exchange in 2023, with a 9.5% market share and $687.0 billion in spot trading volume for the year.
According to the report, Upbit benefited from the Kimchi Premium, which resulted in strong local demand and premium prices for crypto assets.
The exchange’s monthly spot trading volume hit a yearly high of $90.7 billion in December, with a 93.5% quarter-on-quarter (QoQ) increase.
Conversely, OKX secured the third position among centralized exchanges in 2023, with a 6.7% market share and $485.9 billion in trading volume. Throughout the year, OKX experienced a steady increase in market share, starting at 5.1% in January and ending at 8.9% in December. The exchange’s trading volume in Q4 reached $177.9 billion, reflecting a notable 151.6% QoQ gain.
Among the top 10 centralized exchanges, CoinGecko reports that MEXC recorded the highest growth in Q4 2023, with trading volume surging by 203.7% to $90.4 billion.
Bybit followed closely with a growth rate of 162.1% ($107.5 billion), while KuCoin experienced a growth rate of 161.2% ($49.2 billion). KuCoin regained its spot in the Top 10 in Q4 after briefly losing it in Q3, with a market share of 3.3% at the end of December.
Binance Coin (BNB) has successfully maintained its position above the $300 threshold, with the current trading price standing at $304. This represents a 1.8% decrease in price over the past 24 hours.
Featured image from Shutterstock, chart from TradingView.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
A vast majority of European residents have expressed optimism and confidence about the future of the cryptocurrency sector.
According to a Binance Survey targeting users in France, Italy, Spain, and Sweden, around 73% of respondents are positive about the future of digital assets.
A Trend of Optimism
The world’s largest crypto exchange surveyed 10,498 individuals from the selected countries between October 14 and November 8, 2023. The results revealed a trend of optimism, exclusive engagement with crypto assets, surging adoption, growing trust, and increasing utility.
While 73% of the participants expressed optimism about crypto’s future, 55% disclosed that they interact exclusively with digital assets. This indicates a positive perspective on the anticipated growth and adoption of crypto and blockchain technology and steadfast confidence in the market. Around 24% of respondents also revealed more than half of their total trading activities involve crypto.
When asked for their primary use cases of digital assets, 34% of the surveyees said they use the assets for their long-term trading, 26% use them for saving, 13% use them for day trading, and 9% use crypto for purchases. Also, 55% of the respondents use cryptocurrencies for everyday purchases, with 10% making crypto purchases weekly.
Over Half Are Active Crypto Traders
Furthermore, Binance found that the primary drivers of mainstream crypto adoption in Europe are the potential for high returns, the allure of decentralization and financial autonomy offered by digital assets, as well as innovation and technology, as acknowledged by 20%, 18%, and 17% of respondents, respectively.
Roughly 82% of the participants reported being involved in crypto for at least a year, with 73% remaining active in the past five years and 9% disclosing their involvement for more than five years. Only 5% joined the crypto space in the last six months.
In addition, 53% of the respondents are active traders, with the majority engaging in monthly trading. Around 65% prefer centralized exchange wallets, compared to 18% who use hardware wallets.
“The growing use of crypto in everyday purchases and its diverse applications highlights the integration of digital assets into our lives. With Europe at the forefront of implementing a secure and harmonized regulatory framework for the industry through MiCA, it’s evident that the region is actively paving the way for the mainstream adoption of digital assets,” commented Binance CMO Rachel Conlan.
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Following the guilty plea of Changpeng Zhao (CZ), founder and former CEO of crypto exchange Binance, in November 2023, several American states have asked the local arm of the trading platform to refrain from servicing their residents.
The Wall Street Journal reported that authorities in Florida and Alaska recently instructed Binance.US to cease its services in the regions.
Florida and Alaska Restrain Binance.US
Recall that the Department of Justice (DOJ) announced a $4.3 billion settlement with Binance late last year, but the exchange refrained from pleading guilty to willfully floundering the Bank Secrecy Act, among other charges. At the same time, CZ pleaded guilty to failing to implement a strong anti-money laundering (AML) program on the platform, accepting to pay a $50 million fine and resign from the CEO position.
Besides stepping down as Binance’s CEO, CZ also exited his role as chairman of Binance.US’ board of directors and transferred his voting rights to Norman Reed, the firm’s chief executive. Following the changes, CZ’s interest in the exchange’s American arm became purely economic as the company became independent of its global business.
Despite all said and done, regulators in Florida and Alaska said CZ’s guilty plea has made him unsuitable to control Binance.US as he still holds approximately 80% of the firm’s shares.
Within a week after the guilty pleas, the Florida Office of Financial Regulation issued an emergency suspension order against Binance.US’ money services business license, stating that the continued operation of the platform constituted “an immediate serious danger to the public health, safety, and welfare.”
CZ to Be Sentenced Next Month
Furthermore, the Alaska Division of Banking and Securities denied the renewal of Binance.US’ money transmitter license earlier this month because the exchange’s ownership structure did not meet the requirements for renewal.
It is worth mentioning that regulators in Arkansas, Illinois, and South Dakota reached an agreement with Binance.US in December concerning the firm’s continued operation in the states. The settlement requires the exchange to secure a depository account at a federally insured banking institution and make the transfer of CZ’s voting rights irrevocable no later than June 30, 2024.
Meanwhile, CZ has been confined to the U.S. until his sentencing next month despite being released on a $175 million personal recognizance bond after his guilty plea and offering his $4.5 billion equity in Binance as collateral.
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Changpeng Zhao, the founder of the crypto exchange Binance, encountered a setback last month when a federal judge denied his request to travel to the United Arab Emirates.
CZ proposed using his substantial $4.5 billion stake in Binance as collateral, based on the company’s valuation from its last fundraising round two years ago. However, the Judge still rejected the request.
Zhao Requests Travel Permission
In November, Zhao pleaded guilty in a Seattle federal court for failing to maintain an effective anti-money laundering program at the world’s largest crypto exchange. Binance, in response, agreed to pay $4.3 billion in penalties related to the case.
Following his guilty plea, Zhao stepped down as CEO, and his sentencing is scheduled for February 23. Despite the guilty plea, Zhao has remained free in the U.S. on a $175 million release bond. His lawyers submitted a letter requesting permission from Judge Jones to allow him to travel to Abu Dhabi from January 4 for one to four weeks.
The purpose of the travel was to be present for the hospitalization, surgery, and subsequent recovery of an individual whose identity is redacted in the filed letter.
Notably, the details of the medical procedure were also concealed, and it was highlighted that federal prosecutors had not given their consent to Zhao’s travel request.
Concerns About Flight Risk
Judge Jones’ recent denial followed a previous rejection of another request for Zhao to travel to the UAE in December. The Judge justified the decision, citing Zhao’s “enormous wealth” as a substantial flight risk. In an order issued on December 7, Judge Jones stated that his family resides in the UAE, and it appears he has favored status there.
The Judge expressed concerns that Zhao had not demonstrated, by clear and convincing evidence, that he would not be likely to flee if allowed to return to the UAE. Despite the denial, Zhao remains bond-free, with the restriction that he cannot travel outside the United States.
This contrasts with the case of former Celsius CEO Alex Mashinsky, who was arrested in July and is free on a $40 million bond. Additionally, former FTX CEO Sam Bankman-Fried, initially allowed to stay in his parents’ California home after extradition to the U.S. in 2022, was later ordered remanded due to allegations of witness intimidation.
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The highly anticipated hearing of the SEC’s lawsuit against Binance occurred today in Washington, as the trial revealed several challenges for the leading exchange.
Last year, the SEC accused Binance and its U.S. arm of multiple violations, including inflating trading volumes, misusing customer funds, and misleading investors about market controls, further complicating the crypto regulatory landscape.
In presiding over the case, Judge Berman Jackson took a direct approach, bypassing prepared arguments and asking incisive questions. Her skepticism about the necessity of a contract in an investment contract, drawing on the “scheme” language from the landmark Howey case, set a critical tone for the proceedings.
Judge Jackson expressed doubts over the major questions doctrine and the fair notice arguments presented by the SEC, highlighting the ongoing debate around the extent of the SEC’s authority versus that of the Commodity Futures Trading Commission (CFTC).
The Binance case, distinct from the Coinbase scenario, raised unique issues. Judge Jackson’s skepticism regarding the BUSD stablecoin being offered as an investment contract was evident. However, she seemed more open to the argument that Binance’s BNB token might have initially been offered as an investment contract. This led to a broader discussion about the status of tokens on secondary markets, challenging the SEC’s position that a token perpetually embodies an investment contract.
The court session ended without a clear resolution on the SEC’s jurisdiction over tokens like Filecoin, leaving out mentioning other major tokens such as Cardano or Solana. The judge resisted conducting mini-trials for each token mentioned in the complaint, especially when their issuers were not part of the case.
As the legal battle unfolds, its outcomes are set to shape the future of cryptocurrency regulation, with the world watching closely.
