Digital asset exchange Bakkt has decided to remove 23 alternative coins from its platform, primarily due to poor trading volumes and a lack of user demand. AVAX, LINK, FTM, and other coins have been delisted; their prices have fallen significantly due to the statement.
The demand for these coins has fallen short of the exchange’s expectations. Bakkt, owned by Intercontinental Exchange (ICE), had earlier stated its plan to expand its trading offerings to include a variety of altcoins. The company is looking at delisting the affected coins on May 31st, 2023.
The delisting announcement has thrown the cryptocurrency market off balance, and many investors are scrambling to sell their holdings in these coins. AVAX, LINK, FTM, and other coins’ prices have fallen sharply, with some suffering losses of up to 50% in just a few hours.
Industry experts believe delisting could significantly affect these coins’ long-term sustainability. The withdrawal of these altcoins off Bakkt’s platform, one of the biggest cryptocurrency exchanges in the world, might cause a loss of exposure and liquidity, making it more difficult for these coins to draw in new investors.
Cryptocurrency Industry Investors Express Shock At The Development
Delisting, according to some analysts, would potentially be a good thing for the Bitcoin market as a whole. They contend that taking low-quality coins out of trusted exchanges like Bakkt will help to root out dishonest traders and improve the market’s overall quality.
According to Sarah Johnson: an independent cryptocurrency expert stated, in an article, “Delisting is a necessary step for any exchange that wants to remain reputable and trustworthy.” She continued, “Bakkt is sending a message to the market that it is committed to quality and will not tolerate low-quality assets on its platform.”
Investigations show that even after the delisting announcement, many investors are still in shock over the sharp price decline. Meanwhile, Bakkt has been under fire from customers for not providing investors enough time to process the news, while others have accused them for not doing enough to advertise these coins before delisting them.
According to John Smith, a cryptocurrency investor, “I invested a sizeable sum of money in AVAX and LINK, and now I’m facing significant losses. Bakkt should have given us more notice before delisting these coins or, at the very least, done more to market them so that they had a chance to thrive.”
Industry analysts believe that delisting these currencies is merely the most recent illustration of the market’s extreme turbulence and unpredictability. Although these digital assets have the potential to increase in value over time, they are high-risk investments since their value can fluctuate suddenly and dramatically.
More Trouble For Smaller Coins, As More Delisting Is Predicted
The delisting of 23 alternative coins from Bakkt has shocked the cryptocurrency market, resulting in large losses for many investors. Although some industry professionals believe delisting is good for the market, others have contrary opinions. Delisting and other market corrections are anticipated to occur more frequently as the cryptocurrency industry develops.
But analysts think these changes are essential for the market to flourish and grow sustainably. Johnson added that “delisting is a natural part of the market’s evolution.” As the market develops, more exchanges will start to take a strict stance against low-quality coins, ultimately benefiting investors and the whole market.
The report disclosed that Bakkt has been struggling to gain traction for some time now, with quarterly revenue of $13 million, representing 10% below the estimated amount. Further investigations into the activities of Bakkt reveal that the company’s stock recorded an increase of 3.45% year-to-date, unfortunately, went down by almost 40% in the last six months.
Some people conversant with the industry trend said there had been a sign that the company would delist some of their coins. Analysts have confirmed this to be true, considering government agencies’ ongoing scrutiny of major cryptocurrency firms. Meanwhile, experts are still determining whether this move will guarantee a healthy comeback in the future.