In a recent announcement, Binance, a leading cryptocurrency exchange, revealed its plan to delist and cease redemption for XRPUP and XRPDOWN leveraged tokens on July 25, 2023, at 06:00 (UTC).
Binance advised users to redeem their leveraged tokens before the delisting date either through the wallet function or the Leverage Tokens page. If users still hold these tokens after the delisting, Binance will convert them to USDT based on the net asset value (NAV) at the time of delisting. Within 24 hours, the converted USDT tokens will be distributed to users’ accounts. “After the distribution is complete, the leveraged token assets will be removed from the wallet“. According to Binance.
This decision comes amidst the legal battle between the United States Securities and Exchange Commission (SEC) and both Binance and Ripple Labs. The SEC accused them of selling unregistered securities, which led to repercussions on Binance’s leveraged tokens related to XRP.
Leveraged tokens, such as XRPUP and XRPDOWN, allow traders to amplify their exposure to specific cryptocurrencies like XRP. These tokens mirror the price movements of the underlying cryptocurrency through a real-time adjustment algorithm that determines the leverage. However, due to regulatory concerns and the SEC’s lawsuit, Binance has decided to delist these leveraged tokens.
This move is not unprecedented, as Binance has previously delisted tokens this year. Just a month ago, the exchange removed 21 spot trade pairs from the market, including popular assets like Avalanche (AVAX), Axie Infinity (AXS), Polkadot (DOT), Fantom (FTM), Chainlink (LINK), Sandbox (SAND), and Shiba Inu (SHIB). While users can still trade these assets using alternative pairs, the delisting was a result of Binance losing its banking partner for the AUD on-ramp/off-ramp, impacting customer access to the PayID payment portal.
According to one of articles from coingape, The delisting of XRPUP and XRPDOWN leveraged tokens coincides with the SEC’s legal actions against Binance and Ripple, major players in the XRP market. This situation has created uncertainty around XRP’s price, which has remained relatively stagnant between $0.47 and $0.49 for the past three weeks. Despite this, institutional investors have taken long positions in XRP during this period of price stability. Nevertheless, the token’s price has seen a decline of more than 2% in the last seven days.
Interestingly, Santiment data reveals that large XRP holders, known as whales, have increased their wallet balances by 170 million coins since the beginning of July. This accumulation by whales adds another layer of intrigue to the XRP market dynamics amid the ongoing legal proceedings and delisting actions.
Overall, the delisting of XRPUP and XRPDOWN leveraged tokens reflects the impact of regulatory pressures on Binance and the broader cryptocurrency market. As the legal landscape evolves, market participants continue to navigate the challenges and opportunities presented by regulatory scrutiny and the pursuit of compliance.
What do you think of the delisting XRPUP and XRPDOWN in Binance?
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