The world’s leading cryptocurrency exchange by trade volume, Binance, has decided to delist at least five crypto trading pairs, which could shake the platform and the rest of the market.
According to an official blog post from the firm, the affected tokens will be removed from the platform as part of the firm’s regular review process. This process targets crypto trading pairs that no longer meet Binance’s listing standards.
To Mitigate Investor Losses
The change, which will take effect on February 21, 2025, beginning at 03:00 (UTC), will affect DOGS/BRL, FET/BRL, NEIRO/BRL, NEIRO/EUR, and NOT/EUR. According to the firm, targeting the crypto trading pairs ensured the platform remained safe, efficient, economical, and user-friendly. Binance takes such actions regularly to mitigate investor losses.
To avoid any confusion, the firm clarified that users could still trade those tokens using any other available options on the platform. For instance, while the DOGS/BRL trading pair had been delisted, users could still trade DOGS and BRL using other supported pairs. Users trading the affected crypto trading pairs could use the notification as a heads-up to adjust their strategies effectively so they could make a smooth transition before the deadline.
Delisting is a Regular Occurrence with Binance
Binance regularly conducts market reviews targeting crypto trading pairs that are no longer viable due to their low liquidity and trading volumes. According to the firm, the practice helps to keep the trade efficient by enhancing its users’ overall market experience.
While the firm may not have given specific figures for targeting the 5 trading pairs, anyone in the crypto space will remember that it has been an integral part of its practice in maintaining a high-quality market.
Knowledge of the Effect is Essential
As one of the leading cryptocurrency exchanges globally, the platform regularly delists coins, which could send shockwaves throughout the crypto market and cause liquidity crises and price swings as investors quickly withdraw the delisted coins. Investors should take the time to understand the different aspects of token delistings to mitigate potential risks and safeguard their investments. Knowing the effect of such action targeting different crypto trading pairs is essential for investors to take any necessary steps when a token delisting is scheduled.
Parameters for Listing and Delisting
Over the years, Binance has conducted such reviews and delisted many crypto trading pairs to uphold the quality standards it has put in place to maintain its reputation. The platform lists several parameters when assessing a token for listing or delisting. For a token to retain listing on the platform, it must consistently showcase sustained innovation and commitment. Moreover, crypto projects with low liquidity and trading volumes would likely be delisted from the platform.
The platform also takes seriously regulatory and security risks associated with cryptocurrencies, often targeting assets that demonstrate recurrent security issues, including non-compliance with internal security protocols or vulnerability to hacking incidents emanating from flawed smart contracts.
Conclusion
The cryptocurrency exchange conducts regular reviews of all enlisted coins to ensure it maintains only the highest-quality crypto trading pairs. The platform insists this is done to minimize risks affecting its users. It is notable that delisted crypto trading pairs can be relisted when they show improvement.
Frequently Asked Questions (FAQs)
What is coin delisting?
This refers to the removal of a cryptocurrency from a trading platform.
What are the common reasons for delisting?
Common reasons include regulatory issues, low trading volumes, and project failures, which can severely impact coin prices and investor portfolios.
What are the risks associated with the practice?
Delisting could lead to immediate and long-term declines in a coin’s value due to reduced liquidity and investor confidence.
Are there benefits associated with coin delisting?
Delisting presents buying opportunities caused by panic selling, as some investors can identify undervalued coins that might recover or get relisted.
Appendix Glossary to Key Terms
Crypto: A form of currency that exists digitally or virtually and uses cryptography to secure funds.
Trading pairs: Refers to a combination of two different assets that can be traded against each other in a financial market.
Price swings: The temporary highs and lows in the price of an asset.
Trade volumes: The number of shares or contracts traded during a specific period.
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