Why Cryptocurrency Exchange Tokens Are Doing So Well?

By Stan Peterson
Published June 23, 2021 Updated June 30, 2021
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Why Cryptocurrency Exchange Tokens Are Doing So Well?

By Stan Peterson
Published June 23, 2021 Updated June 30, 2021

Introduction

The world has evolved in the past decade. The changes we are seeing in infrastructure, medicine, advances in e-commerce, and much more were not there many years ago. A change they say is the only permanent thing in life, as such, advances in innovation have also birthed changes in payment and cash systems.

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From owning bank accounts and posting funds by Cheques, to the emergence of debit and credit cards, the financial ecosystem has always been seeing one form of growth or the other. The ultimate game-changing innovation was introduced in 2009 with the creation of Bitcoin by an inventor known only as Satoshi Nakamoto. Bitcoin changed the way money or funds gets transferred or exchange hands.

Bitcoin is a digital or virtual currency also known as a cryptocurrency. It forms an electronic payment system where money can change hands peer to peer, without the need for a centralized third party. Bitcoin’s innovation is so disruptive that it has not only empowered and restored confidence in money systems but has inspired the creation of alternative currencies also known as altcoins.

The Advent of Cryptocurrency Exchanges

As financial assets, cryptocurrencies have inherent price or value and are often traded in marketplaces known as cryptocurrency exchanges. The digital currency ecosystem is so prolific today that we are now seeing the emergence of various exchanges or marketplaces, each coming with superior innovation and claiming to bring in a better model to serve the ecosystem better.

cryptocurrency exchange

Today, the cryptocurrency industry has two distinct types of exchanges or trading platforms, and they are;

  • Centralized Exchanges, and;
  • Decentralized Exchanges.

Centralized exchanges (CEXs) are marketplaces where the platform provides the funding or the liquidity that powers the buying and selling of digital assets. These are the very first types of exchanges and the trading platforms usually have similar features compared to mainstream market places where stocks are traded. Centralized exchanges act as the middle man, serving both buyers and sellers accordingly.

Decentralized exchanges (DEXs) are a relatively new concept in the blockchain and crypto ecosystem. These exchanges are born out of a broader concept of decentralized finance (DeFi) where smart contracts or a blockchain-powered set of codes are programmed to control products like lending, yield farming, and more. In a decentralized exchange, users provide the liquidity that powers the trading systems. That is, if a user does not deposit Ethereum, for instance, another user cannot trade Ethereum on that exchange.

Both centralized and decentralized exchanges have advanced with a unique overlapping now being seen. Some of the former exchanges now incorporate decentralized features while the latter trading platforms are beginning to incorporate the features of centralized exchanges. Both outfits usually design or create a native digital currency or token that helps to power the majority of activities being carried out on the exchange.

Some of the identified use cases of exchange tokens include;

  • Payment of transaction fees
  • Utilities in rewards to users from the exchange
  • Liquidity Provision rewards as in decentralized exchanges, and much more.

As digital assets with inherent value, these exchange tokens are known to also grow in valuation and five exchanges, and their tokens stand out per rate of growth through utility. This article will profile these five exchanges and they include, 

  • Binance exchange and its token, the Binance Coin (BNB)
  • Gate.io Exchange and its Gate Token (GT) 
  • Uniswap and the UNI token, 
  • PancakeSwap and the CAKE token, and;
  • Nominex Exchange and its native coin, the Nominex NMX Token.

Let us do a brief digging to understand why these exchange tokens are impressively growing in 2021, and their potentials for future growth.

Binance Exchange and the Binance Coin

The Binance Exchange is arguably the largest digital currency trading platform in the world by trading volume. The exchange was launched back in 2017 to provide a viable marketplace with broad accessibility to everyone in the ecosystem. Binance supports a reasonable number of digital currencies today and operates with the Binance Coin.

binance coin

With security and liquidity one of the major things to watch out for, Binance as a centralized exchange has never suffered any form of hack and has till date not had any liquidity issue. Through the robust trading platform it presents, Binance has grown its user base by a significant number compared to its peers.

Binance operates in many jurisdictions and operates many subsidiaries in regulation-strict regions like the United States of America. With the Binance Coin, Binance offers discounted transaction fees to its users. The exchange has also expanded its offerings through several initiatives to support startup projects in the space. Besides the trading platforms, Binance has Launchpad and Launchpool features wherein new token sales and liquidity farming take place respectively.

Additionally, the Binance exchange has the Binance Smart Chain (BSC), a blockchain infrastructure that seeks to solve the high gas fees and scalability issues of the more native DeFi Ethereum network. The BSC has grown remarkably in the past year, with many decentralized applications now making the blockchain infrastructure their new home. The BSC is also powered by the BNB which serves as its utility token.

The variety of offerings has fueled a burgeoning rise in the price of the Binance Coin. According to Coingecko, BNB has seen a growth of 3,070.6% in the past year. The coin has a market cap of over $78 billion and is ranked as the third-largest cryptocurrency after Bitcoin (BTC), and Ethereum (ETH). While this growth is impressive, the futuristic vision laid out by the Binance exchange and the growing pace of DeFi which will all involve the Binance Coin is bound to fuel a further surge or growth of the digital currency in the future. 

Nominex Exchange and the NMX Token

Nominex is a uniquely designed cryptocurrency trading platform that fuses the provisions of centralized digital asset exchange and offers decentralized finance services such as yield farming through the Binance Smart Chain. 

nominex

The emergence of the Nominex exchange has shown that any new project can grab a large market share, provided it has the right product and incentives to capture the market.

Unique Features from Nominex

Seeing the robust nature of the market around the bigger cryptocurrency exchanges, Nominex creativity integrated unique features to allow it for easy penetration. These features include but not limited to; 

  • The rollout of both CeFi and DeFi capabilities: This translates to a robust liquidity pool and near-zero fees on the centralized platform, and an additional decentralized staking pools capped by a yield farming program that pays as much as 3,800% APY;
  • Unusually High Withdrawal Limits: Users can withdraw up to 3 BTC daily even though they have not completed their KYC requirements;
  • Users get to fund their accounts to purchase BTC through either Visa or MasterCard;
  • Accessing staking and farming products for NMX tokens without leaving the Nominex platform, a feature no major centralized exchange can boast of;
  • Nominex users get 50% off when using the NMX tokens to pay the trading fees;
  • A smooth, easy-to-use trading interface;
  • Smart contracts audited by Unhash.io under the supervision of industry veteran Alexey Makeev, also credited for auditing the Aave protocol; (view report)
  • 8 different referral bonuses plus two types of referral farming bonuses;
  • Completely free trading and withdrawals for those when staking a certain number of NMX.

These and more features integrated by the Nominex exchange scored the points with users as visible in the platform and ecosystem’s growth in general. A lot of great initiatives are being rolled out by the Nominex team, with one prominent one being the proposed fusion of trading with the Binance exchange through the Binance Broker Program. 

nominex-x-binance

With this, users will be able to gain access to all of Binance’s trading pairs and rich liquidity all through the Nominex exchange interface. Additionally, users will still enjoy all of Nominex’s features including the ultra-low trading fees. The Binance ecosystem integration is billed to be accompanied by other new features including copy trading, semi-automatic trading bots, and much more.

A Peek into Nominex’s Referral Program and a Multi-Decade Staking Rewards

The Nominex exchange has an extensively robust referral program designed to reward ecosystem leaders. 

Nominex

Infact, the uniqueness of the referral program remains one of the major highlights of the trading platform since it was launched. While most exchanges permit only a limited number of referrals, with Nominex, you can introduce as many people as you wish to, without any limitation in the number.

The Nominex referral program is organized in the shape of a binary tree, featuring 2 people on level 1, 4 on level 2, 8 on level 3, and so on. The pictorial representation or explanation which can be found in this YouTube video sheds more light.

The Nominex referral model is self-sustaining as it grows out without having to put much effort on the part of the leader. It should be noted that one of the core features of Nominex is that it has eight types of referral bonuses – plus two different yield farming bonuses that are based on referrals. Depending on the activities on a referrer’s downline, a leader may earn up to 50,000 USDT in a week.

Another highpoint of the Nominex exchange protocol is the design of the staking rewards which can earn users over 3000% APY with rewards spread over 70 years. The trading platform has set aside as much as 193 million NMX tokens for its liquidity farming program. However, the possibility of the token or the system experiencing hyperinflation will be eliminated due to the multi-decade spread of the reward.

As of today, Nominex dishes out about 6,640 NMX a day from the main reward pool, with approximately 20 percent of that number (1,330 NMX) being used as bonuses. Any user who deposits NMX for staking gets a cut of the rewards on a daily basis. This staking reward can be accumulated for a longer period. Users who leave their earnings in the system for a long time can increase the reward up to 900%.

Nominex Token and Growth Highlight

The Nominex (NMX) token has seen very good growth since it was launched as a BEP20 token in February 2021. 

NMX particularly surged by over 5000% from a price of $0.10 to over $5.47. The utility surrounding the coin through its use for payment of trading fees, claiming staking rewards, securing tournament rewards, and more have characteristically contributed and is billed to continue contributing to the growing valuation of the digital token.

Uniswap and the UNI Token

Uniswap is a decentralized exchange and one of the pioneering Automated Market Makers (AMM) around today. As a decentralized exchange, Uniswap makes use of Liquidity Pools instead of the Order Books peculiar to centralized exchanges. 

Uniswap

Uniswap is built atop the Ethereum network and anyone can use the platform to swap any tokens or deposit any Ethereum-backed digital token to earn fees through liquidity provisions.

While there is a tendency for Uniswap users to nag about the high gas costs associated with the Ethereum network, the decentralized exchange has been able to creatively mitigated these negative impacts with mouthwatering community incentives. The exchange is also anticipating the launch of its V3 Upgrade with one of the targets aims to increase the rewards to liquidity providers.

The Uniswap ecosystem has grown since inception, pushing the Total Value Locked (TVL) on the platform to over $6 billion. Uniswap’s native token has also seen a tremendous boost over the past month, finding its way as one of the top ten digital currencies by market capitalization. Uniswap has seen an ATH high price of $39, atop a 2917% growth in the past 7 seven months. By virtue of the growth, it has seen since the turn of this year, the ethereum secured token has surged to the rank of the 9th largest digital currency, and has stayed relatively resilient atop many bearish market cycles. 

Uniswap is a force in today’s DeFi and decentralized exchange ecosystem and for its position in the space, the UNI tokens are bound to see more utilities to stir its future growth.

Gate.io Exchange and the GateToken (GT)

Gate.io is a centralized exchange and trading platform that hosts a robust collection of digital currency trading pairs. As an Asian exchange, the trading platform has formed for its robust community of users in South Korea, while also generally catering to the needs of customers around the world. Crypto market data aggregator CoinMarketCap ranked Gate.io as the 6th largest digital currency trading in the world by trading volume.

Gate.io

The exchange’s 8 years of existence have been marked by several pioneering advances in the digital currency ecosystem. Gate.io is one of the exchanges with prominent and functional decentralized finance provisions with yield farming, crypto lending, and a crypto loan amongst the prominent product offerings the exchange has launched for its user’s benefit.

The GT Token is the exchange’s native token and the native token to Gatechain public chain. The exchange has implemented a buyback and burning feature to help deflate the number of tokens in circulation, a move that has a potentially positive impact on the price of the tokens.

The GT Tokens have numerous utilities including but not limited to holder’s privileges to participate in profitable activities such as Initial Coin Offerings (ICOs), Popular Coins Discount, and Vote Airdrops. From an all-time low price of $0.257, the GT tokens have surged by over 1088% over the past year and are now trading above $3. The robust ICO and IEO programs and the role of the GT tokens have boosted the reputation of the exchange, as recognized by third-party data providers.

Per the robust utility and the ecosystem backing the Gate.io exchange and its native token, the possibility to see steady growth over time is high.

PancakeSwap and the CAKE Token

PancakeSwap is an Automated Market Maker and a decentralized exchange native to the Binance Smart Chain. Just as Uniswap is to the Ethereum network, so also is PancakeSwap to the BSC network. Through the alleged superior infrastructure of the Smart Chain, PancakeSwap boasts of providing the appropriate scalability, offer a better user experience, and guarantee productivity across the board through a reduced transaction fee. 

pancakeswap

PancakeSwap and its native token, the CAKE, are an example of the dynamic and creative attempt inherent in the blockchain ecosystem to always develop smart alternatives to existing offerings in the space.

Besides being an AMM, PancakeSwap is also a yield farming protocol built with more refined incentives. With PancakeSwap, users can exchange or swap tokens, provide liquidity through farming and earn fees in return. PancakeSwap has gained tremendous traction since it was launched, bridging the gap in the DeFi world for many who sees accessing decentralized finance products unattracted due to Uniswap’s high transaction costs.

PancakeSwap’s advantage is its cheaper transaction fee for swaps and other features enabled on the platform. The PancakeSwap ecosystem is robust and the exchange has over $8 billion locked across its liquidity and Syrup pools respectively. PancakeSwap’s core product offerings include but not limited to;

  • Swapping,
  • Liquidity Provision 
  • Farming, and;

Besides these products which come with great rewards, PancakeSwap also offers a Bridging infrastructure with which digital currency assets on the Ethereum blockchain can be converted into a Binance Smart Chain-supported asset. This Bridging function helps to bring to life the blockchain function of interoperability in the two competing blockchain networks respectively.

The CAKE token, a BEP20 asset is undoubtedly a high-performing DeFi token to date. Besides supporting a highly productive and diverse liquidity mining pool, it has surged by over 13,283% since November 2020 when it traded at $0.198 to its current value of over $26 according to data from CoinMarketCap.

The growth of the token is arguably inherent in the robust utility that was created around it. CAKE finds its way in the wide range of incentivization programs including in the Collectibles and Team Battle features introduced by the PancakeSwap decentralized exchange. The performance of the CAKE token, over the past 6 months is an indication of traction and revolution DeFi is heralding today.

These and more features integrated by the Nominex exchange scored the points with users as visible in the platform and ecosystem’s growth in general. A lot of great initiatives are being rolled out by the Nominex team, with one prominent one being the proposed fusion of trading with the Binance exchange through the Binance Broker Program.

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Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Stan Peterson
337 Articles
Being an active participant in the Blockchain world, I always look forward to engage with opportunities where I could share my love towards digital transformation.

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