Exchange tokens like Binance Coin (BNB) led the entire cryptocurrency market in gains for the start of 2020. January saw most of them spike by double-digits.
Exchange tokens have proven to be the most successful investment for cryptocurrency traders in 2020 thus far. The various exchange tokens continue to lead the market as traders see them as the less-risky option in this choppy market.
Bullish Exchange Tokens Lead the Market
According to cryptorank.io, most exchange tokens across the board posted double-digit gains last month. The uptick began at the start of January and has steadily continued. It’s increasingly looking like the momentum won’t slow down for February.
BitMax Token (BTMX) led cryptocurrency exchanges with +34.8% gains for the month of January. Binance Coin (BNB) was the second most in gains with a rise of +31.39%. Other exchange tokens which saw double-digit gains are Gatechain Token (GT) with +25.73%; Kucoin Shares (KCS) with +25.32%; Huobi Token (HT) with +24.73%; and OKB with +21.37%.
Now that we are in the first few days of February, the momentum hasn’t stalled. BTMX is at the time of writing posting +29% on the daily, and BNB is up +2.78%. We may see more traders flock to exchange tokens as they further prove their value in this volatile market.
Cryptocurrency Exchanges Continue to Dominate
The growing value of exchange tokens points to the profound influence exchanges hold over the entire market. They also tend to have large amounts of cryptocurrencies in custody, as well. As BeInCrypto reported last month that Coinbase has a whopping 966,230 BTC ($7B) in its cold wallet. Centralized exchanges, therefore, are not only dominating the trading world but also are increasingly becoming the gatekeepers of a large portion of crypto-assets.
Given that 2018 and 2019 were relatively bearish, exchange tokens are now sitting at small market capitalizations relative to their daily trading volume. Traders are also increasingly watching the price movements of exchange tokens to gauge overall market sentiments—if trading volume increases, exchange tokens tend to rise due to more activity on their platforms.
Binance Coin (BNB) continues to lead all exchange tokens in market capitalization, but it’s still far from its all-time high. Currently trading at $18.66, it previously reached around $39.90 in June 2019.