YEREVAN (CoinChapter.com) — Binance’s Changpeng Zhao (CZ) has defended the practice of mass token listings on centralized exchanges (CEXs), as the industry faces growing criticism. Some industry figures argue that CEX token listings focus on transaction fees instead of quality, while others claim that a wider range of listings benefits the market by increasing competition.
Critics Question the Quality of Tokens Listed on CEXs
Many critics, including crypto analyst Benjamin Cowen, have raised concerns about the declining quality of tokens listed on major exchanges. Cowen criticized exchanges for listing tokens that he believes are low-quality and not suitable for long-term investing. He said,
“Some crypto exchanges are listing shittier and shittier coins. They’ll tell you to focus on fundamentals and long-term investing one day, and then list the most useless garbage no one has even heard of the next.”
Further criticism comes from Colin Talks Crypto, who argues that exchanges primarily list tokens to generate revenue from transaction fees. He suggests that CEXs prioritize profit over the quality of listed tokens. In a tweet, he pointed out that many exchanges seem to be driven by profit rather than ensuring that tokens meet high standards. He stated,
“They want trading fees. Period. Many people are degenerate gamblers and exchanges know this. Thus, they carry all the shitcoins to get all the fees.”
Colin further emphasized that exchanges know that many traders are focused on short-term gains and may not be aware of the quality—or lack thereof—of the tokens they are investing in. This creates a volatile market where low-quality coins, which he refers to as “shitcoins,” are promoted for quick profits, attracting traders looking for rapid returns.
Some also argue that exchanges list popular tokens when they are trending and remove them when interest fades. One X user pointed out,
“They want volume and fees and list when it’s hit and delist when it gets cold.”
Binance’s Approach to Token Listings and Delistings
Binance, as a major player in the CEX token listings space, follows a policy of reviewing the performance of tokens listed on its platform. If a token does not meet liquidity or volume standards, it is delisted. Recent listings, including JELLY meme coins from the BNB Chain, have drawn significant criticism for being low-cap and insider-controlled tokens.
Leonidas, a crypto influencer, criticized Binance, saying,
“Your listing team just spot-listed four low-cap insider-controlled meme coins that nobody has ever heard of…”
Defenders of Mass Listings on CEXs
Despite the criticism, some experts argue that mass token listings could ultimately benefit the market. Jason Chen believes that listing more tokens would desensitize the market to speculative hype, helping eliminate the listing effect that causes price premiums for new tokens. Chen explained,
“There will no longer be a listing effect, no more premium, and everything will return to a free game state.”
Changpeng Zhao (CZ) of Binance agrees, stating that while listing a token can provide temporary liquidity and affect short-term price movement, the long-term price should be determined by the project’s development. He emphasized,
“Listing a coin should not affect the price. Prices should be determined by the project’s development, not the exchange listing.”
This reflects Binance’s listing and delisting criteria, which focus on the development team, the quality of the project, and the stability of its smart contracts.
The Impact of Token Listings on Long-Term Valuations
Paul Wei, a crypto trader, argues that listing a token on a CEX can impact its long-term valuation by enabling freer trading. Wei states that coin listings provide access to larger pools of liquidity, which can influence price trends over time.
The ongoing debate highlights the differences between CEXs and decentralized exchanges (DEXs). The recent Hyperliquid JELLY token incident fueled skepticism about the practices of CEXs. Some analysts suggest that DEXs, where tokens are listed without restrictions, allow market forces to determine the true value of a project, free from centralized intervention.
Binance Defends Token Listing Practices Amid Scrutiny
Binance continues to defend its approach to token listings, asserting that its decisions are based on merit, not market manipulation. CZ emphasized that Binance does not engage in practices that manipulate the market and remains committed to offering fair access to tokens.
Furthermore, Binance has introduced a secondary listing mechanism, which allows tokens to be launched through Binance Wallet on decentralized platforms (DEXs). This initiative promotes decentralization by enabling users to access token launches on DEXs, thus creating a more democratic process for token availability.
The debate over CEX token listings remains contentious. Binance faces pressure to balance transparency with the rapid growth of token listings. Critics argue some exchanges prioritize short-term profits over long-term token sustainability, especially within the BNB Chain ecosystem.
The rise of DEXs has intensified the debate between centralized and decentralized exchanges. DEXs offer unrestricted token listings, but their lack of regulatory oversight raises concerns about quality control. Binance’s dual approach to CEX and DEX listings reflects its commitment to offering flexibility and accessibility in the market.
As Binance grows, its listing and delisting policies will continue to play a central role in the future of both CEXs and DEXs. The exchange must adapt to market changes. At the same time, it must ensure fair access to all tokens. This balance will be crucial for Binance in maintaining its leadership position. Adapting to evolving market dynamics will help Binance stay ahead in the changing cryptocurrency landscape.
