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<a href="https://crypto.news/tag/binance/" rel="noopener noreferrer nofollow">Binance </a>Holdings Ltd. is revising its token listing procedures.
The latest move is seen as an effort to bolster investor protection on the platform by <a href="https://crypto.news/binance-shut-down-leveraged-token-listings/" rel="noopener noreferrer nofollow">filtering the tokens listed</a>.
In the wake of numerous incidents where investors were defrauded by unverified digital assets involved in schemes such as <a href="https://crypto.news/binance-freezes-xirtam-funds-after-rug-pull/" rel="noopener noreferrer nofollow">rug pulls</a>, resulting in significant financial losses, Binance aims to prevent the listing of dubious crypto projects by enhancing its listing criteria, according <a href="https://t.co/qmCTtjdyW8" target="_blank" rel="noopener noreferrer nofollow">to</a> Bloomberg
The exchange’s strategy includes modifying the conditions for crypto projects wishing to list their tokens, particularly concerning the “cliff period.”
The period refers to a timeframe during which a portion of the total coin supply is locked within a smart contract.
Only after this period expires do the tokens gradually become available according to a preset schedule. Market makers, essential for providing liquidity, receive allocations of these tokens but face restrictions on their withdrawal capabilities.
Notably, Binance has adjusted the required cliff period to a minimum of one year, a significant increase from the previous maximum of six months.
Additionally, the platform is reportedly seeking to reserve a larger fraction of tradable tokens for market makers, aiming to ensure sufficient liquidity.
You might also like: <a href="https://crypto.news/binances-10b-venture-arm-reportedly-distances-from-exchange/" rel="noopener noreferrer nofollow"> Binance’s $10b venture arm reportedly distances from exchange </a>
<h3 class="wp-block-heading" id="binance-motivations-for-policy-adjustments">Binance motivations for policy adjustments</h3>
“Binance does not impose lock-in periods for projects listed on our exchange,” a Binance spokesperson told crypto.news.
“Each project is able to independently decide their token vesting schedule,” the spokesperson added.
This clarification came in response to questions regarding whether Binance mandates lock-ins on a project’s token vesting period.
Further, the spokesperson elaborated on the rationale for these changes: “It is crucial to mention that the primary focus has always been to protect investors. A longer vesting schedule fosters deeper commitment in projects, thereby benefiting the users and the overall ecosystem.”
The modifications to Binance’s listing policies are not isolated efforts, but part of a broader initiative to enhance regulatory compliance and investor safety amid the platform’s recovery from a tumultuous year.
In 2023, Binance faced significant legal challenges, including a lawsuit from the U.S. Securities and Exchange Commission (SEC) for alleged violations of federal securities law and a substantial settlement with the Department of Justice (DoJ).
The regulatory scrutiny culminated in a <a href="https://crypto.news/binance-settlement-plea-deal/" rel="noopener noreferrer nofollow">$4.3 billion settlement</a> and the <a href="https://crypto.news/changpeng-zhao-resigns-as-chair-of-binance-us/" rel="noopener noreferrer nofollow">resignation </a>of co-founder and former CEO Changpeng Zhao.
Read more: <a href="https://crypto.news/binance-us-coo-claims-sec-lawsuit-led-to-banks-withdrawing-support-strangling-business/" rel="noopener noreferrer nofollow"> Binance.US COO claims SEC lawsuit led to banks withdrawing support, strangling business </a>

Binance extends cliff period for token listings to bolster regulatory compliance

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