Crypto exchange Bitex’s new utility token aims to simplify trading in rupee
- The company will sell the token at a face value of Rs. 10 till June 1, while BTX lists on the exchange on June 4.
- Like most new coins today, the Bitex Coin is also based on the Ethereum chain and will be the native currency for the Bitex exchange.
- The coin is a utility token -- it has value, but it can’t be used to purchase another product.
Like most new coins today, the Bitex Coin is also based on the Ethereum chain and will be the native currency for the Bitex exchange. The company says it will help in “mass adoption of cryptocurrencies” by reducing hurdles in fiat currency to crypto conversion, bank related delays and high fiat deposit/withdrawal fees on platforms. The company said it will charge zero trade fee for BTX trading pairs, and 50% fee for trading with other cryptocurrencies.
What are utility coins?
The coin is a utility token -- it has value, but it can’t be used to purchase another product. In essence, you cannot go to a platform that accepts crypto payments and pay with BTX, at least for the time being. Utility tokens allow crypto exchanges like Bitex to increase their overall market share in terms of trading volumes, since they can be traded only on their own platforms. Platforms like WazirX and Binance also issue their own currencies.
Utility tokens can become full-fledged cryptocurrency in future, but there’s usually a fixed period for that.
“Currently, high fiat deposit and withdrawal fee, custody of fiat funds and 2-5 days to process fiat withdrawals are other major deterrents to trading on cryptocurrency exchanges,” the company said in a press release on Wednesday.
But despite future use cases, the crypto industry has been largely settling into asset-based trading. While popular and mature crypto like Bitcoin and Ethereum still can be used as currency, it’s unlikely that smaller coins like BTX will grow beyond the asset stage. That is, it’s unlikely that they will be widely accepted as modes of payments in future, though one cannot rule them out either.
This cryptocurrency is valued at $45 billion, and it's just a day old