CMC has been the top provider for crypto market cap rankings, charts, and trading data. Although the company has been questioned for its morality over the course of the last 7 years it still remains as the most popular go-to source for Bitcoin and crypto prices. With traffic of approx. 36 million visitors per month CoinMarketCap is known to be one of the biggest players of the cryptospace.
While many Binance supporters or as they call it, Binancians are glad about the sound acquisition, many people from the cryptospace aren’t.
Unquestionably, Binance is the biggest crypto trading platform in the world. Questionably, why is it on a spree to acquire the top blockchain/crypto companies and most importantly, isn’t it getting bigger than what anyone anticipated?
Binance is becoming bigger and bigger as we speak. It ended the year 2019 with the acquisition of WazirX – One of the top crypto exchanges in India, and before we entered Q2 of 2020 it announced the acquisition of CMC. Joining this with the past acquisitions, along with the decentralized applications review platform DappReview, Binance has made over 11 acquisitions some of which have not been made public.
Why exactly is this a red flag?
Binance makes $2,852,591,354 average daily trading volume and has 15M users globally. It handles billions in liquidity and runs Binance Chain, Binance Cloud, Binance DEX, Binance Launchpad, Binance Research, Binance Academy, and Binance X along with its trading platform that in itself makes in billions [Source]. It’s native cryptocurrency BNB has made it to the list of top 10 digital assets and has no use case apart from it being used in the Binance ecosystem.
Binance is a centralized hub of all things crypto-related. This is ironic considering Bitcoin and cryptocurrencies were meant to be decentralized assets in the first place. Here’s a list of problems curated to understand the red flag.
- CoinMarketCap metrics are trusted by millions of individuals dealing in the space to make price-related decisions such as buying/selling assets. How can a data provider run by a centralized cryptocurrency exchange be trustworthy enough to provide accurate data considering the alleged trade washing Binance has previously been accused of in 2019. [Source]
- Everyone hates Craig the Faketoshi but CZ had issues when he delisted BCHSV purely on the basis of personal conflict reflecting in a domino effect making exchanges delist the coin [Source]. That amount of power shouldn’t be allowed in a decentralized space. You can’t add/remove digital assets as per your preference when the data has to be made publicly available for millions of people including the pros and newbies.
- When Binance was hacked for $40 million worth of Bitcoin, CZ tweeted how he was considering a rollback on the Bitcoin network [Source]. Irrespective of the fact that it was not possible it was uncanny that one man thought he had the power to ‘erase’ a transaction from a decentralized network.
- Even though CoinMarketCap is the biggest data provider of the space it has a record of providing false data. This clubbed with Binance could make the two a deadly combination. Especially if things like ‘where to buy’ a particular cryptocurrency directs to Binance.
- The acquisition clarified that CMC would work “independently” even after the acquisition raising concerns for the newcomers who do not understand that their decision making could be based on data manipulated by crypto giants pushing their own agenda.
That said if you’re looking for an alternative to CMC you can do your own research on these data providers: Coingecko, WorldCoinIndex, CryptoCompare, Messari, COIN360, and CoinCheckup.
Disclaimer note: The article represents the contributors’ opinion and does not necessarily represent the views and opinions of Tron Weekly.