The world’s largest stock markets, such as the New York Stock Exchange (NYSE) and the Nasdaq, charge companies $225,000 to $300,000 for IPOs and an annual fee of $70,000. Bitcoin exchanges charge $500,000 to $1 million to list digital assets, which is a much simpler process than listing shares.
Crypto currency exchanges are good for the Bitcoin revolution
On the crypto currency market, ICOs are considered a gold mine for the Bitcoin revolution. High liquidity through the public market means that start-ups can raise millions to billions of dollars without having to restrict the sale of their tokens to authorised investors.
But the tokens also have to be traded on stock exchanges. A listing fee is required for a blockchain project to initiate a token sale and release the digital asset. Trading platforms often take a fee between $500,000 and $1 million, while others take payments in the form of tokens.
In an interview with Business Insider, Michael Jackson, a partner at New York venture capital firm Mangrove Partners, revealed that he had previously led an ICO project. When he tried to float his token on the stock exchange, he was asked to pay listing fees ranging from $50,000 to $1 million, depending on the size and liquidity of the exchange.
Based on the current structure of the crypto currency market, Jackson said that stock exchanges have significant influence on the market and projects are desperately trying to introduce their tokens to satisfy investors and generate large price gains.
“Basically, there are a lot of people who want to list their coins. The stock markets are where the liquidity is – where the money is – where the power is. Investors hope to make money with it. They have to be able to trade it, and many [ICOs] promise their investors what is somehow dangerous.”
Problem with the Bitcoin trader
The problem with the current structure of the Bitcoin trader market, as Binance CEO Changpeng Zhao stressed, is that both investors and blockchain projects seek massive short-term profits that benefit early investors and unload the tokens onto investors entering the project via public exchanges which is reported here: onlinebetrug.de.
To gain liquidity, projects are willing to pay a fee of more than $100 million, as in the case of Ripple to Coinbase, creating a bubble-like ecosystem in the token market.
Oliver Bussmann, the former CIO of UBS, who currently runs a consulting firm, explained that most ICOs are willing to pay several million dollars in fees to be listed on major exchanges such as Binance and Bithumb, typically resulting in two to five times the value of the token in the short term.
“If you’re preparing for an ICO, you need to prepare for a listing.” It is important to have access to liquidity. This means that the larger the exchange, the more effort and expense it takes to be listed.”
Counterfeit volumes for market manipulation
Roy Huang, co-founder of Fresco Network, the world’s first blockchain art asset network, recently announced that a top 30 crypto exchange has offered Fresco to use bots to generate fake volumes to artificially inflate the crypto currency.