Binance Founder Proposes New Idea For Token Issuance

Aliyu Pokima
March 1, 2025 Updated March 2, 2025
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Binance Founder Proposes New Idea For Token Issuance

Highlights

  • Binance founder has proposed a new system for tokenomics for long-term growth.
  • The proposal involves unlocking only 10% of tokens for market sale.
  • Subsequent unlocks must meet strict conditions with a third party controlling keys.

Binance founder Changpeng Zhao (CZ) is reimagining the concept of token issuance in a new proposal. CZ theorizes a smart contract-controlled unlock for tokens designed to prevent flooding the market with new tokens.

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Binance Founder Explores New Standards For Tokenomics

Under CZ’s proposal, only 10% of tokens will be unlocked for sale with the remaining 90% remaining untouched. The Binance founder says the proceeds for the 10% will be deployed for development costs, marketing, salaries, and community building.

A key feature of his “crazy idea” involves strict conditions to be fulfilled before future token unlocks. He argues that issuers must wait for six months after the previous unlock before proceeding with a new unlock.

However, the token price must have doubled its previous unlock price for over 30 consecutive days before the next unlock. According to the Binance founder, token issuers will be allowed to unlock a maximum of 5% of the total holdings each time.

While the maximum unlock is pegged at 5%, the project team has the right to reduce and delay the unlock sizes. Unlocks have the potential to send token prices crashing, accentuated by the incoming $2 billion SOL unlock and tumbling asset price. 

“If they don’t want to sell more, they don’t have to,” said CZ. “But the maximum they can sell each time is 5%, and then they have to wait for at least another 6 months AND the price to double again.”

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Incentivizing Long-Term Builds And Preventing Token Rug Pulls

Right off the bat, the upsides to CZ’s proposal are clear as a strict vesting schedule prevents early dumping. Improper tokenomics standards have fuelled a wave of exit scams in the cryptoverse with the Libra token crash leaving a sour taste in the mouth of investors.

CZ’s idea involves locking tokens with a smart contract and an independent third party controlling the keys. 

“This avoids new tokens flooding the market when prices are low,” said the Binance founder. “It also gives the project team incentives to build for the long term.”

Zhao has previously expressed his displeasure over sharp practices in the space, pledging support for memecoin victims. CZ clarified that he has no plans to launch a new token and that the theory is open for discussion.

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Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Aliyu Pokima is a seasoned cryptocurrency and emerging technologies journalist with a knack for covering needle-moving stories in the space. Aliyu delivers breaking news stories, regulatory updates, and insightful analysis with depth and precision. When he's not poring over charts or following leads, Aliyu enjoys playing the bass guitar, lifting weights and running marathons.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.