Crypto market participants, traders, and investors are increasingly divided over the consequences of mass token listings on centralized exchanges (CEXs).
As discussions about token listings on CEXs become more intense, some industry figures warn about declining listing standards. Meanwhile, others argue that an open listing approach will benefit the market.
Analysts Challenge Mass Listings on CEXs
Benjamin Cowen, a crypto analyst and founder of Cryptoverse, shared his concerns about declining token quality on major exchanges. He criticized exchanges for encouraging long-term investment while listing low-quality "shitcoins", emphasizing their hypocrisy in the crypto market.
"Some crypto exchanges are listing increasingly worse coins. They'll tell you to focus on fundamentals and long-term investment one day, then list useless trash that no one knows about the next," he stated.
Another analyst, Colin Talks Crypto, also argued that the primary motivation behind these listings is to earn transaction fees rather than project quality. Other opinions in the debate suggest that centralized exchanges list tokens when they are trending and remove them when interest declines.
"They want volume and fees and list when it's hot and delist when it cools down. CEXs in this cycle have shown us why DEXs are the future," an X user commented.
In fact, this aligns with the delisting criteria of Binance Exchange. As BeInCrypto reported, this trading platform commits to reviewing the performance of listed trading pairs. It will remove tokens and trading pairs that do not meet liquidity and volume thresholds.
Recent listings on Binance, including meme coins from BNB Chain, such as JELLY, have sparked these criticisms. In this context, crypto influencer Leonidas expressed disappointment with Binance.
"Your listing team just listed four low-market cap meme coins controlled by insiders that no one has ever heard of... I've witnessed in the past year as you continuously list 10-20 million USD trash meme coins while overlooking the largest market cap memecoins with a real community," the analyst complained.
Some others also speculate that centralized exchanges might engage in pre-listing accumulation before selling to retail investors.
Reasons for Mass Listings on Centralized Exchanges
Despite these criticisms, some experts believe mass listings could benefit the market long-term. Jason Chen believes accelerating token listings will saturate the market. According to him, this will eliminate speculative hype around new listings and promote a more competitive trading environment.
"There will be no listing effect, no insurance fees, and everything will return to a free-play game," Chen explained.
Changpeng Zhao (CZ), Binance's founder, agrees with this view, noting that listing a coin should not affect its price. While listing provides liquidity and allows free entry and exit, it can impact price in the short term.
However, according to CZ, this should be very short-term. Long-term, price should be determined by project development. This also aligns with Binance's listing and delisting criteria, analyzing factors like team commitment to the project, development activity level and quality, and network and smart contract stability.
"The DEX model is very good. All coins are listed and people can choose for themselves," CZ added.
Crypto trader Paul Wei also supports this argument but warns against oversimplifying the relationship between listing and long-term pricing. He also challenges CZ's view that listing coins on CEXs like Binance does not affect long-term price, arguing that listing impacts a project's "development" by allowing more free trading, which shapes price trends.
Meanwhile, recent controversies, like the Hyperliquid JELLY token incident, highlight the growing divide between centralized exchanges (CEX) and decentralized exchanges (DEX). BeInCrypto reported allegations of market manipulation. This has raised doubts about centralized exchange activities, leading to debates between CEX and DEX in the cryptocurrency space.
Critics argue that such cases demonstrate the advantages of DEX, where token listings are unrestricted and market forces determine value without centralized intervention.
Amid this ongoing debate, CZ stated that Coinbase's recent decision to list BNB Futures Contract is completely based on real value. It is also worth noting that Binance recently decided to include users in listing and delisting actions, promoting democracy.
The crypto exchange has also adopted a secondary listing mechanism. Instead of only listing new tokens on its centralized exchange, Binance will use Binance Wallet to support token launches on decentralized platforms.
