Today, the cryptocurrency sector is showing an impressive recovery, with many major tokens rising in value in a fairly orderly manner. but, Monero (XMR 0.13%) It is one of the top 50 tokens by market capitalization and is fully up today.
As of 3:30 p.m. ET, Monero had surged 25.1% in the past 24 hours. The move appears to reflect a partial comeback trade from yesterday's delisting crash.Top crypto exchanges Binance announced that Monero and three other tokens would be delisted on February 20th, leading to a sharp decline in these tokens. On yesterday's news, Monero plunged over 32% during the day.
Let’s dig into what is driving Monero’s recovery today.
How bad will this delisting be for Monero?
Given Binance's status as the world's leading crypto exchange, at least in most jurisdictions, this delisting will certainly have a negative impact on Monero's short-term supply and demand fundamentals. Since Monero token withdrawals will not be accepted after May 20th, investors may quickly withdraw their funds from Binance and convert Monero to a stablecoin for withdrawal, leading to strong selling pressure in the short term. may lead to.
Monero’s status as a top privacy coin appears to be a key part of the rationale for this delisting. Binance stated the following in a comment regarding the reason for the delisting:[w]If a coin or token no longer meets this standard, or if the industry changes, we will conduct a more detailed review and may potentially be delisted. ” Cryptocurrency exchanges are taking a closer look at these tokens.
That said, given Monero's comeback rally today, it appears that many in the market still believe in Monero's fundamental value as a privacy-focused payment network.
Is Monero worth buying during a downturn?
I think there are some specific reasons why privacy tokens make sense. In the world of cryptocurrencies, where all transactions are public and easily viewable on the blockchain, companies using cryptocurrencies for transactions are not aware of how much they are paying or charging their suppliers and customers for input costs. You may not want to know the amount. In the backend. For example, healthcare or financial companies may have unique use cases or other regulatory reasons for not wanting to store data on a privacy-focused off-network blockchain.
That said, this delisting reminds investors of the regulatory risks associated with investing in privacy coins. While today's rally is welcome, I think the jury is still out on the market's verdict on this coin. For now, I'm keeping a close eye on Monero and will be sure to provide further updates on this token as the market finds its precarious equilibrium in the coming days.
