Binance announces they will donate 100% of listing fees to charity
Binance, the world’s most active crypto exchange by volume, announced in a press release on Tuesday that the exchange was introducing a novel new fee structure for listing assets. Binance announced that going forward all the proceeds from listing fees would be dedicated to charitable causes. Binance’s listing fees have been critiqued for both their size and opacity for how they are generated.
In addition to announcing that 100% of all listing fees would be dedicated to charity, the exchange has decided to allow prospective listing firms to decide on how much they would like to donate. There is no set minimum for how much Binance expects for each donation. In a tweet on Tuesday, Binance CEO Changpeng Zhao said that he hoped other firms would follow Binance’s lead:
Binance’s announcement further stated that the relative size of a project’s donation would not impact the likelihood of the listing being approved. Donations will be run through Binance’s charitable foundation, called the Blockchain Charity Foundation. The plan is for the size of each donation to be made public by the foundation.
The Blockchain Charity Foundation was established in partnership with the United Nations. The Foundation will be led by Helen Hai, an influential businesswoman who is currently serving as the Goodwill Ambassador for Industrialization in Africa. In an interview with Forbes, Hai outlined the ways that Binance, and Blockchain technology in general, can aid in development and industrialization, saying:
“Binance seeks to become the vanguard to help push this towards increasing more value for grassroots economies, as well as providing bridges towards industrialized economic development with the global capital markets. So, it’s not just that cryptocurrency and charity go hand in hand, but rather that cryptocurrency can represent one of today’s modern accelerators for economic inclusion to the global markets.”
The Foundation appears to be off to a brisk start. TRON, which has been at the vanguard of utilizing blockchain technology for social impact, has already announced that it will be making a substantial contribution to the Binance’s new foundation.
The move follows recent controversy over Binance’s listing fees. In August Christopher Franko, a blockchain developer who was working towards a listing on Binance, tweeted a screenshot of an email purported to be from a Binance representative. The screenshot showed the Binance representative requesting a 400 BTC fee for listing on the exchange.
Zhao fired back at Franko over Twitter in response to Franko’s allegation, claiming that Binance never charges that much as a listing fee. Binance also claimed that listing fees are never quoted in BTC and never sent via email. The methodology Binance used to calculate its exchange listing fees has not been disclosed, however. Zhao and the Binance have maintained that the screenshot showing the 400 BTC exchange fee is fake:
Nevertheless, the move to both donate and publicize all Binance listing fees appears to be aimed at squelching the ongoing controversy. In Tuesday’s announcement, Binance encouraged projects that are currently waiting on a verdict on whether they will be listed by Binance to adjust their application with the size of their proposed donation.
Listing fees have long been standard business practices for traditional asset exchanges, such as stock exchanges. The NYSE exchange publishes a guide to their listing fees, which includes a $25,000 application fee. The London Stock Exchange also charges listing fees on both their main and AIM market.
Much of the frustration in the crypto community regarding listing fees stems from a perception that the fees are exorbitant, along with a lack of clarification over how they are calculated. It is hardly surprising that an industry built around decentralization and transparency is frustrated over the crypto markets largest gatekeepers appearing to be charging opaque and exorbitant fees. Listing fees are said to range from anywhere between $50,000 and $1 million, depending on the exchange.
It remains to be seen if other prominent cryptocurrency exchanges will follow Binance’s lead. In addition to being the largest cryptocurrency exchange by daily turnover, Binance has long been a leader in pushing innovative concepts in the crypto community. Binance recently launched Binance Labs, a social impact fund designed to grow the crypto community and empower entrepreneurs.
Binance’s decision represents an important step in the maturation of the blockchain industry. Standardized and predictable fee structures are present in most established industry, from a realtor renting an apartment to an investment bank leading a billion-dollar IPO. Increasing the clarity and predictability of exchange listing fees will server to increase trust in both projects hoping to be listed, and the traders who ultimately buy assets on these exchanges.