Binance, the world’s largest crypto exchange, has announced the removal of a significant number of coins from its Binance Liquid Swap. A total of 39 liquidity pools are affected, including notable cryptocurrencies like Cardano (ADA), Polygon (MATIC), Bitcoin (BTC), Tron (TRX), and many others.
Binance Liquid Swap is a decentralized finance (DeFi) product that allows users to swap between different tokens using an automated market maker (AMM) model. AMMs work by using a pool of liquidity that is provided by users.
When a user wants to swap tokens, they do not need to find a counterparty to trade with. Instead, they can simply swap their tokens against the liquidity pool.
The announcement, released on August 28, came as a surprise to many in the crypto community. Binance cited the need to optimize trading experiences, prices, and slippage as the primary reasons for this action. However, there might be a broader context at play here.
Regulatory challenges, including lawsuits by U.S. regulatory bodies like the SEC and CFTC, have compelled several crypto companies, including Binance, to adjust their offerings. These regulatory hurdles have been instrumental in shaping Binance’s recent decisions, as dwindling liquidity and trading volumes triggered the need for a strategic shift.
By trimming its liquidity pools, the exchange aims to concentrate liquidity and enhance trading efficiency for the remaining offerings.
Key Coins and Pairs Affected on Binance Liquid Swap
Some of the well-known coins affected by this removal include Cardano (ADA), Polygon (MATIC), Bitcoin (BTC), Tron (TRX), Avalanche (AVAX), Polkadot (DOT), Filecoin (FIL), and even the relatively new Pepe Coin (PEPE).
This action entails a reshuffling of 13 BNB pairs set to be removed from the liquidity pool on September 1, 04:00 UTC. Among these are ADA/BNB, MATIC/BNB, FIL/BNB, AVAX/BNB, GALA/BNB, ICP/BNB, and others.
However, the cryptocurrency exchange clarifies that:
“The removal of the aforementioned liquidity pools does not impact [the] trading of the corresponding pairs on Binance Spot, where applicable.”
As of now, users are no longer able to add liquidity to the affected pools. Those who had holdings in these liquidity pools will receive their assets back into their wallets by September 1.