This Meme Coin Raises 15% After Binance Support – Details

TL;DR

Binance’s support for certain tokens drives up prices, as seen with recent additions. Platform withdrawals often result in significant drops in affected tokens. The Binance Effect

Most major cryptocurrencies have seen little or no price volatility in the past 24 hours, apparently preparing for action following the final results of the US presidential election (set for November 5).

However, some assets still posted substantial gains amid the overall consolidation. An example is the meme coin based on Solana Ponke (PONKE).

Its price soared over 15% minutes after Binance launched the PONKE/USDT perpetual contracts. The offering allows leverage of up to 75x and allows clients to use other assets (such as bitcoin) as margin.

PONKE Price, Source: CoinGecko

Perpetual contracts allow traders to bet on price movements without the need for direct ownership of the assets. They can remain open indefinitely (as long as margin requirements are met) and offer the potential for huge profits. At the same time, however, they are associated with higher risk and can lead to substantial losses.

The support of a major crypto exchange like Binance increases market accessibility, liquidity and visibility. As such, it’s no wonder why the prices of tokens accepted by the platform often head north.

The same thing happened last month when the company introduced 1000CATUSDT perpetual contracts to its futures program.

CAT, the meme coin inspired by the animated series of the same name and launched on Binance Smart Chain, exploded 65% daily, while its market capitalization exceeded $250 billion.

Withdrawal can have the opposite effect

In addition to adding new cryptocurrencies and options to its platform, Binance periodically removes certain assets to maintain a high trading environment and protect its users. Delisting may lead to a loss of credibility and panic among investors, which could cause the prices of the affected tokens to fall.

In October, Binance announced that altcoins Rupiah Token (IDRT), Keep3rV1 (KP3R), Ooki Protocol (OOKI), and Unifi Protocol DAO (UNFI) will no longer be available on the platform as of November 6. KP3R, OOKI and UNFI crashed by more than 40% each shortly after the disclosure.

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