Bitget is raising the stakes. The exchange is introducing new, stricter conditions for listing tokens after the recent disaster with its native token BGB and allegations of market manipulation.
Every blockchain project that wants to get listed now has to go through a comprehensive legal review. The review digs into code quality, security, and overall compliance with the platform’s strategy.
Bitget insists they’ll stay agile enough to allow for innovation. They also believe these steps will help new crypto companies learn the ropes on how to do business properly.
Stricter tokenomics and development team scrutiny
Bitget is also beefing up the entire token evaluation process with updated protocols. A major point of focus is tokenomics.
A detailed look at token supply, distribution, and utility is now needed before any token gets the green light.
The qualifications and experience of the development team behind the project are scrutinized closely too.
For new projects, Bitget kicks things off by analyzing the project’s fully diluted valuation (FDV). This metric shows the potential total value of the project’s token supply.
Bitget has a clear rule. FDV must not exceed 20 times the funds raised. For instance, if a project brings in $5 million, its FDV should remain below $100 million.
The exchange will also be looking at how funds have been handled and where potential risks might be. Projects backed by well-known institutions are more likely to make it through the filtering process.
Lesser-known backers? They get hit with extra due diligence.
The unlock schedule for tokens is another critical aspect of the review. Any project with a short unlock period (typically under two years) raises red flags.
Short unlock times can mean that the development team isn’t committed long-term and is looking to make a quick exit.
This often leads to early sell pressure, putting the token’s stability in danger.
Bitget responds to BGB crash
On October 7, BGB plummeted by over 56%, falling from $1.14 to as low as $0.53 in just a few hours. In an official response on October 8, Bitget explained that the price drop was caused by many large leveraged transactions.
These transactions led to the forced closure of pledge lending, leveraged trading, and contract trading products, which, in turn, caused a gigantic price swing.
Bitget quickly promised to compensate users affected by the price crash. They said that users who held BGB-backed leveraged positions or used BGB as collateral would receive compensation by October 10, which is today, but later.
Compensation would be paid in USDT or through short positions on BGB. Bitget has not provided specific details on what exactly triggered the series of leveraged trades, though some analysts think high-frequency trading or internal market pressures could be the culprits.
