Given its’ history, when most crypto traders think of Bitfinex, they likely do not think of trustworthiness. To make matters worse, the saga of Bitfinex and Tether seems to have no end in sight with the New York Attorney General’s investigation still ongoing and Bitfinex about to do a Tether-based fundraising round.
Until today, the details of this round were unclear, beyond the fact that Bitfinex was aiming to create its’ own exchange token that would be used for future Initial Exchange Offerings and other related projects. Early this morning, however, the whitepaper for Bitfinex’s LEO token was finally released to the public.
As many crypto investors likely suspected, the whitepaper raises a few key questions that are largely left unanswered. In a general sense, it’s first important to note that it appears that Bitfinex is trying to shift its’ business model to be more like Binance’s, at least in terms of using exchange tokens to save on trading fees and invest in projects doing IEOs.
Logically, the principal question that comes to mind with this is: can Bitfinex ever attain the same level of industry trust as Binance has? If their financials that are included in the whitepaper are to be believed, this would appear to be possible. If, on the other hand, the picture that the New York Attorney General is painting of them is to be believed, it would seem that quite the opposite is true.
In truth, the whitepaper is not exactly helpful with regards to this debate. Little further details about the token sale are mentioned beyond the fact that basically, the more LEO tokens you hold, the more efficiently you will be able to trade due to the fee reductions. Since the sale is private, it is reasonable to conclude that any future details that do surface will do so through leading crypto news outlets like CoinDesk. Until then, keep in mind that trusting in an exchange token is the same as trusting in a stock. Doing so isn’t necessarily inadvisable. It just means putting your faith in a centralized authority.
By: BGN Editorial Staff