Binance has started offering pre-market spot trading, the first time an exchange is offering the trading of actual tokens before they are listed on the regular spot market.
This new initiative helps users get early access to a newer token and even helps them change their trading plan. Whereas competitors use derivatives, the service uniquely provides real tokens for users to own and exchange.
Binance’s pre-market service is much more beneficial as it allows trading with real tokens rather than derivatives, as with Bybit and Coinbase.
Bybit’s pre-market trading uses derivatives that require USDT collateral, while Coinbase allows trading through perpetual futures contracts that change to standard futures after token listing. In contrast, Binance allows users to interact with the actual tokens, which improves user experience and real market activities.
Pre-market trading will work alongside Binance Launchpool, where users can earn new tokens by staking other digital assets.
Tokens from specific Launchpool projects can be traded before the market opens. This period allows users to trade these tokens; however, they cannot withdraw, transfer, or deposit them until the token is officially listed on the spot market.
Offering Early Trading for Launchpool Projects
To provide more value and extend the life of projects on the platform, Binance created the Pre-Market service.
The new service enables users to trade some tokens issued by Launchpool ahead of the token’s official listing with certain limitations. Binance will inform the users of the commencement of pre-market trading and the date for each eligible project.
Once the pre-market trading period starts, every user of Binance will be allowed to trade the tokens labelled as “pre-market.”
However, pre-market trading will end at least four hours before the opening of the official spot market. Binance will officially announce the listing once the pre-market period is over.
The service is set to provide a specific user trading environment to help increase strategy and flexibility.
Withdrawal and transfer limitations are implemented to protect the market during the pre-market phase. Due to the real tokens, Binance is much more reliable and convenient than the derivatives-based services of other exchanges.
Binance Expands Services Amid Regional Trading Limits
Even though it is a relatively new feature, Binance’s pre-market spot trading service cannot be accessed by traders in some countries because of legal factors.
These regions include the United States of America, Canada, Dubai, Japan, the Netherlands, Russia and Spain. Binance has to obey the laws of individual countries, which does not allow it to offer pre-market trading in these territories.
Binance is still working on expanding its services in other areas where such operations are allowed. This is because the exchange has embraced the compliance regime, thus offering a secure place for the users. Despite some restrictions, Binance can attract users worldwide due to the early trading of real tokens.
In another matter, Binance helped India’s Enforcement Directorate seize funds from a $47.6m gaming fraud related to the Fiewin app.
The scam was to entice victims into online betting schemes and then steal their money. Binance’s participation shows that the exchange and its CEO want to create a safer environment for cryptocurrencies and help fight against fraud.
