Binance Set to Delist Six Altcoins on August 19

In a significant move, Binance, the world’s largest cryptocurrency exchange, announced that it will delist six altcoins: PowerPool (CVP), Ellipsis (EPX), ForTube (FOR), Loom Network (LOOM), Reef (REEF), and VGX Token (VGX) on August 19, 2024. This decision follows Binance’s assessment that these altcoins no longer satisfy the platform’s rigorous standards for listed assets.

Review Process for Listed Altcoins

As part of its commitment to maintaining a high-quality trading platform, Binance regularly reviews the altcoins available for trading. This process involves a careful evaluation based on several key criteria, which play an essential role in determining whether an asset will remain listed or be removed. By conducting these evaluations, Binance aims to enhance the overall user experience and remain adaptable to the rapidly changing cryptocurrency market.

The factors taken into account during the review process include the dedication of the project team, the calibre of development activities, trading volume and liquidity, as well as the security and stability of the underlying network. Additionally, Binance considers the project team’s responses to due diligence inquiries, any instances of unethical or fraudulent behaviour, and evolving regulatory requirements.

Details on the Delisting

The six altcoins identified for delisting—CVP, EPX, FOR, LOOM, REEF, and VGX—failed to meet the criteria established during Binance’s review process. Users trading these altcoins are required to finalise all spot trading by 06:00 CET on August 26, 2024, when the delisting will take effect.

Binance emphasised that this decision was made primarily to safeguard its users and to uphold the quality of the assets available on its platform. Users currently holding these delisted altcoins are encouraged to act promptly to mitigate potential losses.

Recent Developments from Binance

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The recent announcement underscores Binance’s ongoing efforts to ensure that each digital asset listed on its exchange meets high industry standards and requirements. In its own words, “When a coin or token no longer meets these standards or the industry landscape changes, we conduct a more in-depth review and potentially delist it.” Binance reaffirms its commitment to providing top-notch services and protections for its users while continuously adapting to market shifts.

The company assesses a variety of indicators, including the commitment level of the project team, trading activity, development progress, network stability, and other relevant factors. Following its evaluation, Binance confirmed the suspension of trading for the six altcoins.

The specific trading pairs slated for removal include CVP/USDT, EPX/USDT, FOR/BTC, FOR/USDT, LOOM/BTC, LOOM/TRY, LOOM/USDT, REEF/TRY, REEF/USDT, and VGX/USDT. Notably, all active trade orders will be automatically cancelled once trading ceases for these pairs, providing users a clear timeline for the delisting.

Market Impact and Historical Context

Historically, delisting from a prominent exchange like Binance has led to a decrease in asset prices, primarily due to diminished liquidity, damage to reputation, and subsequent trader panic. Following Binance’s announcement, the affected coins experienced immediate price drops. In particular, CVP, FOR, EPX, and VGX saw declines of around 40% within a day. LOOM and REEF also faced significant drops, albeit to a lesser extent, with losses of approximately 14% and 23%, respectively.

This trend of price crashes following delistings is not unprecedented. Earlier in the year, Binance removed support for Monero (XMR), Aragon (ANT), Multichain (MULTI), and Vai (VAI). As a result of that decision, the price of Monero, a well-known privacy coin, fell by a staggering 35%. The same pattern emerged when the exchange ceased trading with BarnBridge (BOND), Dock (DOCK), Polkastarter (POLS), and Mdex (MDX); these cryptocurrencies collectively saw declines in the double digits, with DOCK experiencing a sharp drop of approximately 50% within 24 hours.

Conclusion

The delisting of CVP, EPX, FOR, LOOM, REEF, and VGX from Binance represents a critical step in the exchange’s mission to maintain a high standard for the assets offered to its users. As the landscape of cryptocurrency continues to evolve, such evaluations and delistings are a reminder of the inherent volatility in the market and the need for investors to stay informed and proactive in managing their portfolios. Users of Binance should take this opportunity to assess their holdings and take necessary actions to avoid potential losses as the delisting date approaches.