A recent disclosure made by Simon Dedic, the CEO of Moonrock Capital, has sparked a discussion regarding the expenses and availability of centralized exchange (CEX) listings.
Sharing insights on Twitter, Dedic recounted a conversation with a noteworthy crypto project that had secured a substantial investment, only to face obstacles with Binance. The project was offered a listing deal, but with a condition – Binance demanded 15% of the total token supply in exchange.
This request, as explained by Dedic, translated to a significant amount ranging from $50 million to $100 million. He commented,
“This amount is beyond the reach of most projects and it significantly impacts the token’s market performance.”
Response from Binance – Providing a Defense
Binance’s co-founder, Yi He, responded promptly to the allegations, disputing Dedic’s statements and emphasizing the rigorous screening process the platform employs. She stated,
“Projects must meet the strict screening criteria to be listed on Binance, regardless of the financial offerings involved.”
He encouraged the community to explore the token allocations of projects listed on Binance to comprehend the transparency of their processes.
While Binance’s Launchpool and other listing methods have clear guidelines for airdrops, she clarified that providing airdrops does not guarantee a project’s acceptance.
Recognizing the prevalence of fear, uncertainty, and doubt (FUD) in the crypto space, the co-founder urged users to think critically, noting that many rumors stem from speculation and competition.
Listing Fees at Binance
CryptoCrypto also investigated Binance’s updated policy on listing fees in 2018. The exchange pledged to disclose all fees and committed to donating the entire amount to charity.
Under this new approach, project teams are asked to propose a “listing fee,” now referred to as a “donation,” without a fixed minimum or a specified amount dictated by Binance.
Allegations Against Coinbase
Following the revelations, Coinbase’s CEO Brian Armstrong stepped in and asserted that listings on Coinbase are free of charge. He also expressed support for decentralized exchanges (DEXs) as viable alternatives for projects.
However, Andre Cronje, co-founder of Sonic Labs, raised concerns about Coinbase, noting that while Binance did not charge for listing, Coinbase requested fees ranging from $30 million to $300 million.
Justin Sun, the Founder of Tron [TRX], also claimed that Coinbase demanded 500 million TRX (equivalent to $80 million) and a $250 million Bitcoin [BTC] deposit in Coinbase Custody as part of their listing conditions.
CEXs vs. DEXs
Despite recent criticisms, centralized exchanges (CEXs) continue to dominate the trading arena. According to data from Messari, CEXs contribute to around 90-95% of the total trading volume.
Currently, CEXs command a market share of $17.27 billion, representing 94.52% of the total volume of $18.27 billion. In contrast, DEXs make up $1 billion, accounting for 5.48%.
With the community advocating for increased transparency and fairness, the ongoing dispute between CEXs and DEXs could significantly impact the future of digital asset trading.