U.S. based cryptocurrency exchange Bittrex has announced that it will delist 82 tokens on its trading platform, including BITS, BITZ, CRBIT, CRYPT, FC2, GEMZ, and METAL. Most of the altcoins being removed have a bad combination of low demand and low liquidity.
Bittrex said in a statement that, “Occasionally, there are circumstances that lead Bittrex to remove a coin’s wallet or market from the Bittrex Exchange. These actions are taken to ensure customers have access to digital tokens that continue to meet our strict coin listing criteria and have a properly functioning blockchain and wallet.”
Bittrex instructed holders of the affected cryptocurrencies to transfer the coins to other wallets or face forfeiture of the coins: “Once these wallets are removed, we will no longer be able to recover these coins. Users must withdraw their coins before March 30, 2018, in order to keep them.”
Though it is common for an exchange to delist coins that are not doing well, with a majority of altcoin projects are abandoned within 6 months of being created anyway, the mass action by Bittrex is especially dramatic. The action is probably partly intended to help Bittrex avoid undue attention from the United States Securities and Exchange Commission’s (SEC). Lack of liquidity can lead to price manipulation (wash trading and artificial volume inflation), of which many exchanges are guilty, and for which the SEC is now watching. Expect other U.S. exchanges to also soon delist a lot of low liquidity altcoins for the same reason.
Bittrex used to be one of the leading altcoin exchanges in the world. It added several dozen new currencies since November 2017. Some of those coins have since suffered low trading volumes or even zero trading volume in the case of irreparably broken blockchains. Among the list of 82 currencies to be delisted are 26 currencies with severe blockchain issues. Altcoins with non-working blockchains cannot be withdrawn because the blockchain is either has no network nodes left to receive and broadcast transfers or the remaining network is too slow to process transactions.
With Bittrex’s trend of frequently adding many new altcoins to its exchange now reversed, lesser-known cryptocurrencies may end up “stuck” on smaller exchanges.
By: BGN Editorial Staff