Binance, a leading crypto exchange, has announced the discontinuation of support for Binance leveraged tokens (BVLT). Trading and subscription services for all BVLTs will be suspended on February 28 at 06:00 UTC.
This decision marks a pivotal shift in the trading environment for leveraged tokens linked with Tether, such as BNB, Ether, and Bitcoin (BNBUP, BNBDOWN, ETHUP, ETHDOWN, BTCUP, BTCDOWN).
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe - We publish new crypto explainer videos every week!
How to Buy Crypto SAFELY With a Credit Card (Animated)
These tokens offer traders leveraged exposure to the underlying asset, reducing liquidation-related risks. However, Binance notes that:
There are still risks associated with leveraged token positions, such as the effects of price movements in the perpetual contracts market, premiums, and funding rates.
The platform has advised traders to convert their leveraged tokens to alternative assets before the suspension. Post the trading halt, Binance will phase out and stop redemption of these tokens from April 1 to April 3, ensuring traders have a window to redeem their holdings.
For those unable to redeem by the deadline, Binance plans to automatically convert the tokens into USDT, reflecting their value at the time of delisting, and credit the amounts to user accounts within 24 hours.
This ensures a safety net for investors, albeit emphasizing the importance of adhering to the set timelines.
This move by Binance signals a cautious approach towards leveraged products, reflecting on the intricate dynamics of crypto trading. As the market evolves, traders and platforms alike navigate the fine line between innovation and risk management, shaping the future of digital asset trading.
In other Binance-related news, the exchange planned to delist Monero, among other tokens.
