Essentials to know before exchange-listing
Bitcoin is the mother of all cryptocurrencies because its creators came up with brilliant technology first. That’s why it is logical that when Bitcoin grows, every other coin grows. When it drops, every other coin also drops. Therefore stability in the Bitcoin price leads to an increase in growth of tokens. On August 21, tokens recorded major losses in the global cryptocurrency market.
Policy of exchanges is another important aspect influencing the token price and listings. The main difficulty occurs when dealing with major exchanges is the variety of irrational prices and enormous fees created artificially.
Bitcoin decline in value makes tokens unstable
In the last days, many of top 100 tokens and recently listed tokens declined by 5 to 15 percent against both the US dollar and Bitcoin, demonstrating high volatility. Meanwhile, Bitcoin recorded its 14-month low monthly volatility, showing slight signs of constancy in the lower price range of $6,500.
Crypto market experts note that stability of Bitcoin is the most important element in the price trend of global crypto markets. The token market tend to follow the price trend of Bitcoin and Ethereum as their price has positive correlation.
BITS token success depends on the timing of listing
Over 90% of exchange-listed coins and tokens actually traded below the ICO price when being released during Bitcoin decline. This goes to point out an important statement — for reaching successful results of token listing, it is necessary to wait for Bitcoin gaining stability.
Bitcoinus is seeking to give what was promised to all the supporters — performing everything what is in our power to make BITS token prosperous when releasing it to exchanges. Currently, crypto market is too risky and unpredictable for the appearance of new tokens. Professionals suggests to wait out this period of the market struggle in order to protect the value of unlisted tokens.
A big weight carried by an ICO
When a project starts an ICO and carries in a good amount of investment, at best, that money must be dedicated to create a product and add value to the project by allowing the company to employ more professionals to the team.
Contrary to this scenario, what often happens is that the ICO gets put under pressure straightaway from early contributors who got the biggest discounts or bonuses to list on a major exchange as soon as possible. The contributors, who see only short-term perspective, don’t care about the project or the crypto community. They’re here to arbitrage their connections and their ability to negotiate discounts as high as 90%, in order to grow their gains and move on to the next project who needs their investments.
ICOs need to give away a tremendous listing fee to a major exchange in order to satisfy the early supporters. We all heard of Binance increasing their listing fee from $2m to $6 million due to increasing demand. Eventually, if the project will manage to come up with those amounts of money, there’s still no guaranties that the exchange will decide to make a listing.
Dirty business of major exchanges
A lot of major exchanges claim that you maintain the services of specific bots what’s known as market MAKERS (MM). To put it simply, a MM is an entity that will make sure that their computer lists at least 10 buy orders and 10 sell orders on the exchange at any time. Some exchanges request 20 orders on each side, or even more. MM makes it appear as though there is notable activity and liquidity on the market on both sides, and to establish an image of high volume.
The created volume and low spreads gives profiteers the false comfort that they can get in and out of positions at any time even if there is no real buyers or sellers on the other side. Estimated that nearly 90% of all trades on exchanges are not with humans, but with such bots. The MM does not take any financial risk or benefit the token holders, as they only create liquidity, but do not change net volumes or the direction of price.
Important fact is that MMs services are expensive, and it’s typically up to the ICO to pay for it. Not only that, but exchanges often have a third fee, meaning that the exchanges will demand a deposit of millions of coins and tokens from the ICO in what they call a “liquidity deposit”.
Binance announced a plan of profit of $1 billion this year. That money appear from ICOs in the form of high fees, trading in front of their client orders and shorting their own listed coins. That billion dollars Binance has taken for itself doesn’t bring any benefits for the crypto community in the long term.
What is the conclusion?
Firstly, for reaching successful results of token listing, it is necessary to wait for Bitcoin gaining stability. The crypto market becoming stable is the best impulse for making the token step up.
Secondly, given the previously discussed situation, the exchange has the ICO’s property, a market maker, and a mass of speculators. As these exchanges can see the trading volume and movement right before you, they always win. That is why we cannot play along and let them overrule.
The main priority of Bitcoinus is business development. Big goals are set and the vision of business expansion must be fulfilled. Having an innovative product with a lot of additional features to offer for the market is the main merit. It leads to the long lasting success and is necessary for token value to grow in the future. Certainly, an endless improvement is the number one antecedence to every business with a long-term vision.
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