Binance co-founder and former CEO Changpeng “CZ” Zhao has expressed reservations about the cryptocurrency exchange’s token listing procedure, stating that it is problematic and needs to be improved. He pointed out that the current approach allows for price manipulation, as traders use decentralized exchanges (DEXs) to pump up token prices before they are listed on centralized exchanges.
CZ’s comments came following Binance’s launch of the Test (TST) token, which was originally intended for a BNB Chain instructional but quickly acquired speculative interest. Within hours, TST’s market capitalization soared to about $500 million before collapsing by more than 50% owing to profit taking.
He mentioned that Binance’s listing announcements are often made just four hours before trading begins, which encourages pre-listing speculation. As traders anticipate price increases, they purchase tokens on DEXs before selling them on Binance, resulting in high volatility and sell-offs.
To overcome this issue, CZ suggested that CEXs explore automating their listing process, similar to how DEXs function. He contended that a more open and transparent system would reduce manipulation and provide equal access to new tokens. However, he underlined that he is no longer involved in Binance’s operations and provided his perspective as an outsider.
Despite leaving Binance as part of a legal settlement, CZ remains a significant figure in the cryptocurrency business. His proposal to revamp token listing rules has spurred debate about whether centralized exchanges should adopt a more automated and decentralized approach.
The appeal for reform emphasizes the continued issues of balancing accessibility, liquidity, and market stability in the bitcoin ecosystem.
