The LEO tokens of Bitfinex reach the top 10 Coinmarketcap

Bitifnex launched the UNUS SED LEO token less than a year ago, and now it has entered the top 10 marketcap. This achievement, while impressive, reflects the significant difference in both utility and top cryptocurrency design.

Bitfinex’s LEO token was launched as a token utility for the exchange platform, joining a growing group of such cryptocurrencies. Currently, most trading activity is done on the Dragonex exchange. For the most part, the LEO value is speculative, based on its use in margin trading. Officially, Bitfinex promotes it as a token utility, offering rebates on trading fees when LEO is used to pay them.

The climb to the top of CoinMarketCap reflects the fact that LEO has reached a significant degree of investment. For the most part, however, its value is calculated by associating with Tether, the controversial cryptocurrency stable of Bitfinex. The market cap LEO is currently approaching $ 1 billion and growth in value in recent days could be connected to the fact that $ 40 million in Tether has recently entered the crypto market.

? ? ? ? 40,000,000 #USDT ($ 40,439,191) transferred from Tether Treasury to #Bitfinex

Tx: https://t.co/pec9I4Y5U3

– Whale Alert (@whale_alert) March 16, 2020

The utility tokens dilemma

The success of the Binance token (BNB) prompted a series of exchanges to launch their own versions. Own tokens are a simple way to collect large amounts quickly.

Most, such as LEO, can be used to benefit from commission reductions, which makes them popular with speculators. Thus, in a short time, the exchange tokens have come to have impressive capitalization.

The main criticism of these cryptocurrencies is that they lack the decentralized architecture of traditional blockchain assets, such as Bitcoin. Issuing exchanges maintain a significant degree of control over their use.

The LEO token of Bitfinex is centralized

For example, last year, Cointelligence reported that Bitfinex introduced a smart contract in the LEO code that gives the exchange complete control over the functionality of the token. This contract offered Bitfinex the opportunity to increase or decrease the offer as desired. It even has the ability to delete LEOs held by users in private wallets.

Currently at least five of the top twenty top cryptocurrencies are either stable cryptocurrencies or controlled by a central entity. Crypto purists also claim that such coins should not be included in the same charts as those based on blockchain permission-less technology.

In any case, the evolution of LEO and other utility tokens depends largely on exchanges and speculators. Given the significant volatility of the current crypto market, they will play as important a role as decentralized currencies.