Coinbase CEO Proposes Overhaul of Token Listing Process Amid Surging Crypto Creations

Coinbase CEO Brian Armstrong has suggested revamping the token listing process to handle the overwhelming influx of new digital assets. With nearly one million tokens launching weekly, Armstrong proposes shifting from an allow list to a block list approach while incorporating on-chain data scanning and community reviews.

Coinbase Faces Challenges in Token Listings
As the largest cryptocurrency exchange in the U.S., Coinbase has traditionally maintained a stringent multi-step process for listing new tokens. This involves an extensive evaluation of a project’s purpose, technological infrastructure, team credibility, market demand, and compliance with regulatory guidelines.

Given the increasing pace of token launches, Armstrong acknowledged that the existing system is unsustainable. He pointed out that manually reviewing and approving a million tokens weekly is infeasible, even for regulators.

To streamline operations, Armstrong proposed transitioning from an allow list model, where only pre-approved tokens can be traded, to a block list model. Under this approach, most tokens would be tradable by default, with only high-risk assets being blocked based on community reviews and automated on-chain monitoring.

Additionally, Armstrong emphasized Coinbase’s ongoing efforts to integrate native support for decentralized exchanges (DEXs). He suggested that users should not need to distinguish between trading on centralized and decentralized platforms, as Coinbase aims to provide seamless access to both.

Justin Sun Questions Coinbase’s Listing Policies
Not all industry figures are convinced by Armstrong’s proposal. Tron founder Justin Sun publicly criticized Coinbase’s listing strategy, citing TRX’s prolonged review period. According to Sun, TRX, despite ranking among the top ten cryptocurrencies and achieving multiple all-time highs, has been under review for seven years without being listed.

Sun questioned whether TRX would only be considered if it debuts on major stock exchanges like the NYSE and Nasdaq or if Coinbase had no intention of listing it at all. He accused the exchange of lacking fairness and objective industry judgment.

Coinbase’s Delisting Controversies
Coinbase has faced scrutiny over past delistings, notably that of Wrapped Bitcoin (wBTC). The exchange cited risk assessments and concerns over Sun’s involvement in the project, but critics argued that the move was anti-competitive, favoring Coinbase’s own tokenized BTC product, cbBTC.

Following the delisting, BiT Global, a strategic partner of wBTC custodian BitGo, filed a lawsuit against Coinbase, alleging anti-competitive behavior and business disruption. The court is scheduled to review Coinbase’s motion to dismiss the case on April 3.

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