As we’ve seen from powerhouse examples like Binance’s BNB, exchange tokens can often make promising returns for investors. However, that has not been the case with the Bitfinex’s LEO token. Here are three possible reasons why that might be.
1. LEO Came Late to the Game
Bitfinex’s LEO token was launched in May of this year after the company claimed it had raised $1 billion USDT and USD in a private token sale.
As per the whitepaper, the LEO token promises holders reduced fees and other discounts on BitFinex and EthFinex. And, very much like the BNB token, one of LEO’s most important value props is that it carries out token burning to increase the token’s scarcity over time.
However, unlike BNB, LEO was launched on an exchange that saw the slowest growth in 2019. This was coupled with some rather low trading volume, despite once claiming the lion’s share of BTC trading.
Despite the numerous touted benefits of LEO, August trading volume on Bitfinex had all but dried up. And LEO has seen relatively low demand ever since.
As Binance continues to dominate every area in the space from IEOs, DEXs and crypto derivatives, Bitfinex is currently languishing in 72nd place in the rankings per reported volume.
After the roaring success of BNB and some other exchange tokens like KuCoin Shares and Huobi Global Token, could it be that LEO came too late in the game?
2. Other Exchange Tokens Are Simply More Attractive
You only have to analyze the performance of other exchange tokens to see that LEO has failed to live up to expectations.
In fact, October was a disastrous month for LEO as it fell under $1 dollar,