Binance Co-Founder Speaks on TST Token Controversy

Binance Co-Founder Clarifies Token Listing Criteria Amid TST Token Controversy

Binance’s co-founder has addressed concerns regarding the exchange’s token listing criteria following the dramatic rise and fall of the Test (TST) token, which briefly soared to a $500 million market capitalization before experiencing a sharp decline.

Most retail cryptocurrency investors allocate their funds through centralized exchanges (CEXs) such as Binance and Coinbase. Tokens listed on these platforms often gain significant visibility, leading to heightened investor interest and increased demand. Consequently, understanding Binance’s token listing process is crucial for both investors and project developers.

Key Criteria for Binance Token Listings

According to Binance co-founder Yi He, the most critical factor in a token’s listing decision is its return on investment (ROI). This is determined by comparing the token’s first-day average price with its quarterly performance across other major CEXs. Speaking to Colin Wu in an interview published on February 10, Yi He emphasized that a strong ROI is a fundamental requirement for any token seeking to be listed on Binance.

The second key benchmark revolves around the project’s ability to drive innovation and attract new users to the cryptocurrency ecosystem. Binance prioritizes projects that have the potential to convert casual traders into long-term blockchain participants, fostering the industry’s overall growth.

The third criterion focuses on high-profile projects that generate significant market buzz and maintain strong valuations. Binance closely monitors a token’s market performance on other leading exchanges. Yi He explained that if a token with strong technological fundamentals and high market demand is absent from Binance, the platform risks losing its competitive edge.

“These three standards allow us to evaluate a diverse range of projects, from highly sought-after ‘VC tokens’ to long-term potential projects and even memecoins that drive substantial hype and wealth generation,” He elaborated.

Concerns Over the Binance Listing Process

Yi He’s clarification comes shortly after Binance’s co-founder and former CEO, Changpeng Zhao, admitted that “the Binance listing process is a bit broken.” Zhao highlighted the role of arbitrage opportunities exploited by decentralized exchange (DEX) traders, which often lead to underwhelming token performance post-listing.

DEX traders, who are typically more experienced investors, tend to identify emerging cryptocurrencies before they are officially listed on a CEX. The announcement of a CEX listing often acts as a buy signal, prompting these traders to accumulate the token early and sell immediately after the listing, leading to intense selling pressure.

Addressing Insider Trading and Compliance Measures

To maintain integrity, Binance enforces strict regulatory and internal compliance measures. Yi He revealed that Binance has conducted over 120 internal investigations into misconduct, which resulted in the dismissal of 60 employees.

However, He clarified that the majority of these violations were unrelated to insider trading. Binance enforces stringent policies that prohibit employees from engaging in trading activities. Instead, the most common infractions involved accepting bribes or redirecting company wallet funds to personal accounts.

“We have taken legal action and filed reports on these cases, involving both domestic and international jurisdictions,” He stated, reinforcing Binance’s commitment to maintaining transparency and regulatory compliance.

Binance’s token listing process remains a critical aspect of the cryptocurrency landscape, influencing both investor sentiment and market trends. By emphasizing ROI, innovation, and market demand, Binance continues to refine its approach to listing new tokens. As the industry evolves, addressing challenges such as arbitrage trading and internal misconduct will be essential in ensuring a fair and transparent trading environment.