Binance US, the American-based subsidiary of Binance, the largest cryptocurrency exchange by volume, has announced plans to delist the cryptocurrency assets Tron (TRX) and SPELL on April 18, 2023. The company stated that it periodically reviews the assets it lists, and when a “digital asset no longer meets our high standards, or industry circumstances change, we conduct a more in-depth review of the affected asset and assess whether further action is necessary (i.e. delisting).”
Binance US will close deposits for SPELL and TRX on April 17, 2023, the day before delisting, but withdrawals will remain open. Although it is delisting Tron’s native asset TRX, Binance US will continue to support USDT’s TRC20 version and USDC issued on the Tron network.
The delisting news follows Binance being sued by the U.S. Commodity Futures Trading Commission (CFTC), and Tron founder Justin Sun being sued by the Securities and Exchange Commission (SEC) five days earlier. In the SEC lawsuit against Sun, the U.S. regulator insists TRX is an unregistered security, and Sun has also been accused of market manipulation. Spell is associated with the Abracadabra.money project, which issues the stablecoin asset called magic internet money (MIM).
Binance US states that delisting usually relates to a cryptocurrency asset’s changing risk profile, volume and liquidity, the network’s resilience to external or internal attacks, and “regulatory standing in the United States.” The U.S. has been cracking down on cryptocurrency businesses, and on March 9, 2023, New York Attorney General Letitia James filed a lawsuit against Kucoin and declared that ether (ETH), the second-largest cryptocurrency by market cap, was an unregistered security. In the first week of April, the crypto exchange Bittrex announced that it was closing U.S. operations due to regulatory uncertainty.
The news of Tron and SPELL’s delisting caused TRX to lose 2.8% of its value against the U.S. dollar, while SPELL lost more than 4%. Nevertheless, some investors remain bullish about Tron’s future prospects.
Tron, launched in 2017, is a blockchain-based platform for creating decentralized applications (dApps) and smart contracts. It aims to reinvent the internet by offering a decentralized platform of sharing entertainment content, such as music and videos, enabling creators and consumers to interact directly without intermediaries. The project has attracted a large following, particularly in Asia, and its founder, Justin Sun, is a well-known personality in the crypto industry.
Tron has been criticized in the past for plagiarism allegations and for exaggerating its partnerships and achievements. Nevertheless, the platform continues to improve, and it has recently implemented several upgrades, including the TRC20 standard, which supports more complex smart contracts, and the TRON Bridge, which enables interoperability between the Tron and Ethereum blockchains.
Tron has also been expanding its ecosystem by launching new dApps and partnering with other projects. For example, it has launched the decentralized social network BitTorrent, the stablecoin USDJ, the decentralized finance (DeFi) platform JustSwap, and the gaming platform TronGameCenter. It has also partnered with Samsung, Opera, and BitGo, among others.
Tron’s supporters argue that its low transaction fees, fast confirmations, and large user base make it a compelling alternative to other blockchain platforms, such as Ethereum or Binance Smart Chain. Moreover, they believe that Tron’s vision of a decentralized entertainment industry is achievable and has the potential to disrupt traditional models.
However, Tron’s detractors point out that the platform still faces several challenges, such as scalability, security, and regulatory scrutiny. They also question its centralization, as most of the network’s nodes are controlled by a small group of super representatives. Furthermore, they criticize Justin Sun’s marketing tactics and his past controversies, such as the failed lunch with Warren Buffett and the allegations of bid rigging for a charity auction.
In conclusion, Binance US’s decision to delist Tron and SPELL cryptocurrencies reflects the growing regulatory pressure on the crypto industry, as well as the exchange’s commitment to maintaining high standards and complying with the rules. While this news may affect the short-term price of TRX and SPELL, it does not necessarily undermine the long-term potential of Tron or other blockchain projects. As the crypto ecosystem evolves, investors will need to perform their own due diligence and assess the risks and opportunities of different assets.
