TL;DR
- Binance will stop trading and redeeming some of its leveraged tokens (BTCUP, BTCDOWN, ETHUP, ETHDOWN, BNBUP, and BNBDOWN) by April 3.
- Leveraged tokens are derivatives that give more exposure to crypto assets, but also have higher risks and volatility.
- Binance’s decision is a strategic move to comply with regulations and offer better products to its users.
Binance, the world’s first crypto exchange, has announced that it will stop supporting some of its leveraged tokens that are linked to Bitcoin, Ether, and BNB by April 3. These leveraged tokens are BTCUP, BTCDOWN, ETHUP, ETHDOWN, BNBUP, and BNBDOWN, and they are paired with Tether.
The exchange will halt the trading and subscription of these three leveraged token pairs on Feb. 28 at 06:00 UTC. It will also remove all the trade orders for these tokens on that date. Users will not be able to place any new orders after that. Binance advised its users to exchange their leveraged tokens for other assets before the deadline.
Binance will then start to delist and stop redeeming the tokens from April 1 to April 3. Users can still redeem their tokens until the delisting date. If users do not redeem their tokens by then, Binance will convert them into USDT based on their value on the delisting date. It will then send the tokens to the users’ accounts within 24 hours and delete the leveraged tokens from their wallets.
Binance’s Leveraged Tokens: A Brief Overview and Their Benefits and Risks
Leveraged tokens are derivatives that give investors more exposure to the crypto assets they track. They represent a group of perpetual contract positions that are affected by the price changes in the perpetual contract market.
Binance said that leveraged tokens let crypto traders take leveraged positions without any collateral. They also do not have to keep a maintenance margin level or worry about liquidation. However, Binance also cautioned that trading leveraged tokens has its risks, such as the “effects of price movements in the perpetual contracts market, premiums, and funding rates.”
Binance has decided to stop supporting Binance Leveraged Tokens. This is a major change in Binance’s product strategy, which shows its commitment to innovation, compliance, and user satisfaction.
Binance’s decision also reflects the changing nature of the cryptocurrency market, which requires constant adaptation and evaluation of product offerings. Users who are affected by the change should act quickly to modify their portfolios so that they can continue to trade effectively with the new cryptocurrency trading options that Binance offers.
