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- Bitget faces a $10 million shortfall after controversially listing and then removing TokenFi, a product of the Floki Inu project.
- Despite Floki Inu’s request to delay the token listing, Bitget proceeded, resulting in significant trading without adequate reserves.
Crypto derivatives exchange Bitget faces a daunting $10 million deficit following the contentious listing and subsequent delisting of TokenFi (TOKEN), a product of the Floki Inu project. The move has not only garnered criticism from major industry figures but also thrown a spotlight on the meticulousness required for new token listings.
Announcement on The Delisting of TokenFi (TOKEN) and Buyback Plan
Full details below:https://t.co/gMsQwasQ5p
— Bitget (@bitgetglobal) October 31, 2023
Floki Inu’s Claims and Bitget’s Response
Floki Inu stated that Bitget took the hasty step of listing a potentially counterfeit version of TokenFi. The project had explicitly asked exchange platforms to postpone the listing of their token for a week after its launch. Their intention was to carry out a DAO vote to ensure the listing decisions were backed by community consensus.
SETTING THE RECORDS STRAIGHT ABOUT THE UNAUTHORIZED BITGET $TOKEN LISTING
On October 18, 2023, we put up a DAO proposal to launch the Floki staking program and a reward token that will target a trillion-dollar industry with strong potential. While we didn’t mention it in the DAO… pic.twitter.com/JGnlKmR0lo
— FLOKI (@RealFlokiInu) October 31, 2023
However, Bitget, overlooking the request, went ahead with the listing. This oversight led the exchange into trading millions of dollars without having sufficient assets to back user withdrawals. Such financial setbacks underline the importance of prudence and due diligence, especially when it comes to new token listings.
The aftermath saw Bitget struggling to cover its $10 million shortfall. The remedy requires Bitget to acquire 10% of TokenFi’s total supply. This is challenging because a significant portion of TOKEN is locked in Floki’s staking pool, creating a liquidity concern. With most of the TOKEN unavailable for immediate trading, Bitget’s recovery strategy remains unclear.
Industry Reactions and Future Implications
Changpeng Zhao, the CEO of Binance, one of the world’s leading cryptocurrency exchanges, took to social media to criticize Bitget’s oversight. His sentiments echoed the frustration of many in the community, pointing out that the Floki Inu project’s FLOKI and TOKEN holders were inadvertently affected.
@bitgetglobal really messed up with the wrong community this time 😶🌫️🎯
— Richard Teng (Parody) (@_RichardTengo) November 1, 2023
In an attempt to mitigate the damage, Bitget has announced a 5-day buyback plan. The strategy aims to compensate TOKEN holders on Bitget at its peak trading value, converting their assets to USDT. The urgency of this plan showcases the severe consequences that exchanges can face in such instances.
Moreover, Bitget’s traditional practice of placing new tokens in an Innovation Zone for a two-month observation didn’t prevent this mishap. The exchange has accused the Floki team behind TokenFi of financial discrepancies, emphasizing concerns about TOKEN’s unclear financial dynamics. Their decision to delist the token was framed as a necessary measure to protect user interests.
In contrast, the Floki team, defending their position, reiterated their initial request to potential exchange partners, highlighting the unauthorized listing of TokenFi. They stressed the importance of community-driven decisions, especially in the volatile world of cryptocurrency.
With the dust yet to settle, the market outlook for TOKEN and FLOKI remains a focal point of interest. TOKEN, despite the controversy, has witnessed a 20% increase in its price, with its market cap standing at an impressive $18.15 million. This event is a stark reminder to exchanges about the repercussions of hasty decisions and the need for comprehensive vetting processes. This incident underscores the complex dynamics and the level of scrutiny required in the ever-evolving cryptocurrency space
