Inside Korean Black Market of Crypto Exchange Listings: $5 Million Price Tag
An increasing number of blockchain companies are flocking to the initial coin offering (ICO) market to initiate token sales and raise millions of dollars in an unregulated market. According to several local projects, brokers are demanding millions of dollars to be paid out for unconditional listings.
$2 Million Unconditional Listing
Last week, cryptocurrency researcher Christopher Franko claimed that based on an email he obtained from the Expanse development team, Binance, the world’s biggest digital asset exchange, has been charging more than 400 Bitcoin ($2.5 million) to list cryptocurrencies and tokens.
On Aug. 11, Changpeng Zhao, CEO of Binance, told its investors and users that the exchange does not list “shitcoins” even for 4,000 BTC and every cryptocurrency must go through a rigorous verification process established by Binance.
“We don’t list shitcoins even if they pay 400 or 4,000 BTC. ETH/NEO/XRP/EOS/XMR/LTC/more listed with no fee. Question is not ‘how much does Binance charge to list?’ but ‘is my coin good enough?’ It’s not the fee, it’s your project! Focus on your own project!”
All complaints about listing fee come from projects we did not list, ie, did not charge (did not even ask for a fee). It’s not the fee, it’s the project. Granted, there are many great projects out there we haven’t listed. Working on it.
— CZ (not giving crypto away) (@cz_binance) August 11, 2018
Whether or not Binance has been charging upward of 400 BTC for a listing, Zhao and the Binance team have emphasized that every listing is verified and approved by the exchange–and even for a sum of $25 million, the exchange does not list cryptocurrencies that are not up to par with other projects in the community.
In South Korea and the market’s medium-sized cryptocurrency exchanges, brokers have been offering $2 million to $5 million listing offers to newly created blockchain projects desperately looking for liquidity on public exchanges, according to local media outlets.
Etnews, a local publication in South Korea, reported that brokers have been offering multi-million dollar listing opportunities to blockchain projects, touting unconditional offers. If a blockchain project pays a broker anywhere from $2 million to $5 million, despite the state of the project, an exchange listing is supposedly guaranteed.
The CEO of a highly anticipated blockchain project in South Korea, who asked to remain anonymous due to the sensitivity of the subject, said:
“We’ve met with top three cryptocurrency exchanges in the world and they’ve all clarified that there is no listing fees involved in the process of listing digital assets. Prior to speaking to large exchanges, we were told that we need at least $5 million to be listed on a widely utilized cryptocurrency exchange.”
Are Exchanges Really Not Accepting Listing Fees?
The statements of three blockchain project CEOs that spoke to Etnews last week demonstrated legitimacy in the claims of exchanges like Binance–in that cryptocurrency exchanges do not actively seek large digital asset listing fees.
Rather, brokers and intermediaries involved in the process are said to be taking a hefty chunk of the non-existent fee to assist a project’s token to be listed on a particular platform.
Following Binance, local cryptocurrency exchanges including Coinone, the third biggest digital asset exchange in South Korea, clarified that they do not even accept capital from blockchain projects for marketing and airdrop purposes.
Currently, digital asset trading platforms like Huobi, OKEx and Binance all initiate voting processes to list favorite user tokens. For blockchain projects, rather than investing millions of dollars on brokers running a fraud and illegal services, a better method would be to develop a token actually worth listing to increase cryptocurrency market legitimacy.
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