In this case study, we examine if building a good project is enough to get listed on cryptocurrency exchanges free of charge or if such a feat is even possible.
Very often, we see projects having large premines and/or founders block reward cut. Expensive cryptocurrency exchange listings are the recurrently used rationale. Is it justified or quality projects can find their way to free cryptocurrency exchange listing? Information presented below should provide a solid overview of this topic.
We contacted a dozen of various crypto exchanges from different volume categories to find out what is their listing policy. More specifically, do they consider free coin listings under any circumstances? The exact question we asked was:
Which is the main criterion you take into consideration when listing an altcoin without a fee?
Getting a proper response wasn’t easy as this is a sensitive question for most exchanges. Hence, we didn’t receive too many valid answers. Responses varied but gave good insights into overall listing policies. After all, profit and reputation are the two main things most exchanges care about. Keep those in mind while reading responses.
In this day and age, technically speaking, top cryptocurrency exchanges have the power to decide which coins will thrive and which will die a slow death due to lack of liquidity. Getting listed is often expensive and far from easy feat as competition is immense. It is important to note that adding common coins like BTC forks and ERC-20 tokens is much easier than adding an original coin, coded from scratch. These coin listings require a lot more effort.
We also all need to understand that exchange business and listing selection process is not easy; new projects are popping up every single day at an alarming rate. Keeping up to date and going through listing requests is a time-consuming task and requires appropriate human resources that many new exchanges lack.
Exchanges have multiple sources of revenues. Those include:
- listing fees: 0.1-5 BTC,
- trading fees: 0.05-2%,
- withdrawal fees: varies greatly.
Listing fees are usually the main and only guaranteed source of income for smaller exchanges due to lack of volume most new coins generate. On the other hand, big exchanges tell a different story. Their listing fees still represent a solid chunk of revenues but are just a tip of what they earn from trading fees.
Let’s make an example. The world’s largest cryptocurrency exchange – Binance, burns a portion of native BNB tokens every quarter. 20% of quarterly income is allocated to the BNB burn. From that, we can easily calculate their quarterly income. According to their latest, 8th burn, their total income in Q2-2019 was around $119m. Hence, the listing fees are only a drop in the bucket for larger exchanges. Most can afford to offer free listings or use listing fees merely as a somewhat efficient but far from perfect scam filter. With that out of the way, let’s go over some of the exchanges we contacted.
Binance doesn’t have a specific listing fee; each project is free to propose a listing fee they deem appropriate. Without any guarantees of being listed of course as this is the least important part of listing application. All listing funds are donated to charity after the listing is completed. Official announcement where the above is confirmed can be found here. Binance maker and taker trading fees are 0.1% for regular accounts across all trading pairs.
We didn’t receive an official reply from Binance but let’s examine a few examples of coins that got listed free of charge. Those are many of the top coins, Dogecoin (DOGE) and Ravencoin (RVN). How and why did they get listed free of charge? Some answers can be found in CZ’s listing guidelines located here. But those are exceptions rather than the norm.
Dogecoin has an extremely strong community built over the years, and peer pressure coupled with significant trading volume did its job. It is so popular that Elon Musk was elected as DOGE “CEO” and he said that DOGE is his favorite cryptocurrency. One other thing to note is that DOGE has historically been one of the main alt season messengers. It would have been quite the feat if they timed the market and announced the start of alt season. Unfortunately, it didn’t play out like that.
Other top coins that got listed for free were listed simply because of their immense popularity and trading volume they bring along with the listing. ETH, XRP, and variety of stable coins were listed as they need them for the purpose of using them as trading pairs.
Even though CZ himself noted that if you focus on your project and make it good enough, it might get listed free of charge, but as can be seen, it is rather an exception than the norm. 98% of projects aren’t even considered for a paid listing. You basically need to be creme de la creme if you want to have a 0.01% chance of getting listed free of charge. It is not impossible but extremely hard to achieve. As expected, there are no set in stone guidelines, original codebase or developer activity are not the norm. Both DOGE and RVN are Bitcoin forks. However, popularity and unique niche might be one of the solid clues.
Since Binance DEX emerged another interesting strategy surfaced. It involves issuing a token on Binance Chain, gathering decent DEX volume (at least $50k daily) and hoping that Binance CEX listing will follow. However, this method is not free as issuing and listing a token on Binance DEX costs 1500 BNB. The initiative is fully supported by Binance, and details can be found here.
qTrade is a community favorite, relatively small cryptocurrency exchange that became well known for the free Nyzo listing. They also set a recent record by listing a particular coin within 24 hours of the community raising attention about it, also free of charge. Listing Nyzo was not an easy task and required extensive preparations and building of required tools. For example, Nyzo didn’t have an API, so an appropriate replacement had to be built from scratch, then raw transaction handling was required and so on.
Costs of free listing are being offset by higher taker trading fee of 1.5%. This is a great option for new projects that offer solid tech but do not have required funding or refuse to pay exchange listings for ethical reasons. They don’t need to ask the community for donations or employ large premines. Instead, each trader chips in over time and everyone should be satisfied in the end. There will be users that disagree with the above approach, but you can’t please everybody.
Regular qTrade listing fees range from 0.1-2 BTC while trading fees vary depending on pairs. All maker fees are 0% while taker fees float between 0.5% and 1.5%. If you are not in a rush or have itchy finger which demands market orders, you can avoid fees and trade for free.
qTrade explained their free listing process in a detailed response to our question:
Free listings are a complicated topic since there are so many variables that go into the mix, and there really isn’t a single thing we look at when making a decision. In general, we take a fundamentals-based approach. A short list of the biggest deciding points are:
1. How interesting the tech is. Does it solve tough problems? Does it have long term growth potential?
2. How well it’s written. If it has code written, how clean is it? Is it stable, maintainable, etc.
3. Hype. If lots of people are excited about a currency that is often a good indicator they’re doing something right, and vice-versa.
4. Competition. We’re too small to compete with large exchanges.
There are many other factors we evaluate, but I hope this answers your question.
More details regarding their general listing process can be found here. In closing, the coin needs to meet the criteria, show potential for perspective future, and free listing can quickly become a reality.
KuCoin isn’t disclosing the amount they charge for new coin listings, and we are not aware that they disclosed free listings outside of the main coins required for trading. Their trading fees for regular accounts is 0.1%. Below is the answer we received as a response to our free listing query:
We have a strong project research team consisting of over 20 professionals with diverse backgrounds. They will review every listing application on a diligent basis, and the whole process usually takes a couple of months. KuCoin receives many listing applications every day, and less than 10% can be successfully listed at last.
For each project that approaches KuCoin, we will assess it in terms of over 100 sub-criteria that constitute 6 key aspects:
1. Team and Advisor;
2. Token Metrics;
3. Technology and product;
4. Market performance;
5. SNS & Userbase;
6. Investors, partners, and Influencer.
If your project satisfies all of the above, there is a slight chance your coin might get listed free of charge. No guarantees as usual. Recently, they ran a promotion where the community had a chance to recommend projects they like the most. Winners might get a free listing if they pass Kucoin review.
STEX is a mid-range cryptocurrency exchange that regularly lists new coins. Their listing fee is not publicly disclosed. But as can be seen from various community donation drives, their typical listing fee is 2 BTC. Standard trading fee for unverified accounts is 0.2%. The answer we received was brief, and they weren’t interested in disclosing details:
This question is quite complicated, and there is no universal answer to it.
From the unofficial information we gathered; If you are not a special case that would greatly benefit STEX exchange don’t hold your breath for a free listing on this exchange.
DDEX is a decentralized exchange for Ethereum based tokens built on Hydro protocol. Default market maker trading fee is 0.1% while the market taker fee is 0.3%. Token listing fees are not publicly listed. But the answer we received proves that free listings are possible if the main criterion is met:
Traction in trading momentum is the main criterion we take into consideration.
Since DDEX only supports ERC-20 tokens and their platform is built around Ethereum, listing new tokens do not require significant additional work. Hence, we believe they can afford to be more lenient with free listings even if they bring questionable volume.
Digital Price is a small exchange with relatively cheap listing fees. They were running a promotion in which they offered listings for a very reasonable $1000. Trading fees are 0.2% for most trading pairs. Given the low trading volume, listing fees are probably their main source of income. Hence the answer we received was expected:
We do not list any altcoin free of charge, the only coins that we might take into consideration in listing free would be coins like Dash, Litecoin and similar, this because they are well established, and people use them to move around funds, saving them some fees that sometimes are very high in Bitcoin.
Crex24 is a relatively small exchange that regularly lists a lot of new coins. Currently, they have over 500 coins listed. Trading fees are low. Market makers do not pay fees. Rather, they are incentivized in the form of rebates ranging from 0.01-0.05% depending on monthly trading volume. Market takers pay 0.1% fee by default. As can be seen from the low trading fees, Crex24’s main source of revenues comes from listing fees. The answer we received confirmed this theory:
Thanks for the email, but we do not integrate coins for free.
Liquid belongs to the higher end of the middle exchange range. All rankings we mentioned in this article should be taken with a grain of salt as measuring exchange volume is difficult. Real data is probably known only to exchange owners. Liquid has fixed maker and taker trading fees of 0.1%. But If the fees are paid in QASH (native exchange token), 50% discount is applied. They provide IEO platform for issuing new tokens. Listing terms and fees are not publicly listed. As can be seen from the response we received, they do not consider free listings:
Under no circumstances do we list tokens for free.
However, issuing tokens through their IEO platform might strike some good deals if both parties are compatible.
As can be seen from the responses we received, getting listed for free is a hard but not impossible achievement for many new coins. Trading volume is the main factor most larger cryptocurrency exchanges evaluate as it is their main source of income. Smaller exchanges are more dependent on listing fees due to their low liquidity. But skipping a listing fee is possible even on small exchanges if you can demonstrate solid tech and potential for solid trading volume which offsets listing costs.
Tiny, new exchanges might even list you free of charge without notice as they are fighting for publicity and volume. Listing respected coins is a good start to gain both. We know of multiple cases where unknown exchanges approached specific projects or listed them out of the blue.
There is another viable option for a quick and potentially free cryptocurrency exchange listing. Project owners can try to make a deal with exchange they deem appropriate for their coin and strike a deal for Initial Exchange Offering. IEO is the hot new ICO variation and is a popular combination for raising money and getting solid liquidity right from the start. However, don’t think that this will be any easier for most new projects as exchanges that care about their brand are very careful and diligent about IEO’s. After all, their reputation is on the line. Disgruntled investors are quick to jump ships. The best example is Bittrex with their lineup of unsuccessful IEO’s.
Lastly, there is one more thing you can work on as a coin developer – build all of the required tools to help exchanges do their part as quickly as possible and expedite the potential free listing. It sounds like common sense but is often missing. qTrade co-founder summed up some of the key things that slow down the integration process in the screenshot below:
Gathering all of the information presented above was an interesting, albeit difficult task. We hope it sheds some light on the exchange listing process and the viability of free cryptocurrency exchange listing for project owners and investors alike. As always, feedback through Twitter is appreciated.
As a final thought – building a great product, along with a prominent reputation, is the key. If you build a reputable project, which is backed up by a proper community, you have a solid chance for something that might seem impossible – a free cryptocurrency exchange listing.
Petar & Ana