Investor Trust in Exchange Tokens Sees Resurgence, Overcoming FTX Scandal Shadows
Crypto exchange tokens have shown resilience, rebounding from the lows caused by the FTX scandal and reaching new highs amid the ongoing bullish market.
Investor confidence in these tokens has been restored, with prominent examples such as Binance‘s BNB and OKX’s OKB demonstrating significant gains.
Exchange tokens, issued by centralized entities, offer users various benefits on exchanges, including trading advantages, payment for gas fees, and participation in decentralized finance activities on exchange-created blockchains.
Some tokens also enable users to engage in governance activities on the respective platforms.
BNB, Binance’s native exchange token, currently trades at $354, marking a 32% increase since November 2022, when FTX’s bankruptcy announcement sent shockwaves through the crypto exchange ecosystem.
Additionally, BNB has surpassed previous highs in June 2023 when news of investigations by the U.S. Department of Justice (DOJ) and a lawsuit by the U.S. Securities and Exchange Commission (SEC) against Binance emerged.
While the DOJ settlement has been reached, the SEC lawsuit remains ongoing.
Likewise, OKB, OKX’s native exchange token, has experienced a remarkable recovery, surging by 132% from its FTX lows and achieving a total gain of 3,227% since its launch in May 2019.
On January 25, the OKB token faced a flash crash that wiped out nearly $6.5 billion within minutes.
However, it swiftly rebounded and reached new all-time highs.
The flash crash was triggered by a brief market sell-off leading to leveraged liquidations on the OKX platform.
The exchange has taken responsibility for the incident and compensated affected users through an airdrop.
Moreover, Bitget exchange’s BGB token has surged to all-time highs of $1.03,
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