The world of cryptocurrencies is vast, with a plethora of different crypto assets and tokens available, which poses a challenge for centralized exchanges (CEX) when it comes to selecting the right coins for listings.
Data from CoinGecko reveals that there are approximately 15,000 cryptocurrencies in the market, ranging from popular coins like Bitcoin (BTC) and stablecoins such as Tether (USDT) to exchange tokens, memecoins, and others. Despite this large number, major exchanges like Binance only list around 2.5% of these tokens. Binance, for example, currently lists 378 cryptocurrencies on its platform, as reported by Coinranking.
Choosing the right cryptocurrency for listing on a CEX can be a daunting task. To assist exchanges in this process, the onchain analytics firm Nansen has teamed up with the Bitget crypto exchange to release a new report titled “Discovering Token Potential for Trading and Exchange Listing.”
In the report, Bitget and Nansen Research teams have adopted various methods to assess token potential based on the token’s stage in its lifecycle. For emerging tokens, the focus is on offchain metrics and traction, while for established tokens, onchain metrics are utilized.
Published on July 29, the collaborative report leverages Bitget’s market expertise and Nansen’s blockchain analytics to offer users a more informed crypto investment experience. Bitget emphasizes key principles when considering a token for listing, such as evaluating its growth potential, promptly listing popular assets, and providing a diverse range of options to users.
The Bitget research team has also implemented an automated onchain data monitoring system to evaluate coins for listing based on five key dimensions: market traction, community validation, technological innovation, token economics, and security. The report emphasizes the importance of stringent controls to ensure high-risk assets are not listed, highlighting the need to assess risks related to smart contract security and token distribution.
Even for tokens already listed, it is crucial to monitor risks like trading suspension and the potential for changes in token balances by the contract issuer. Projects where the team holds 50% of the tokens are deemed highly centralized and risky, according to the report, which also recommends that addresses related to the token creator should not control more than 20% of the supply.
Ruslan Fakhrutdinov, CEO and founder of the hybrid crypto exchange X10, explains that smaller exchanges face the challenge of limited liquidity in each market, making it necessary to strategically select which tokens to list. Fakhrutdinov advises exchanges to conduct thorough research on a token’s team, roadmap, and project details to avoid listing unreliable tokens and potential delistings.