Binance Launchpad, the platform developed by Binance Exchange for conducting Token Sales has changed its ICO format. The platform moved from a first come first serve basis to a new lottery format after the former raised several complaints.
Binance announced this change on Sunday, March 24 in a blog post to its community published on its website.
“We will use a new lottery format for the next project on Binance Launchpad, the post read adding:
“The next Binance Launchpad token launch will be conducted as a lottery, instead of a first-come-first-served system.”
Users Complain about Binance Launchpad Token Sale format
Since the historic token sale of the BitTorrent token on Binance Launchpad, users have complained about the inability to participate. Due to the extremely high demand for the tokens sold on Binance Launchpad, users who participate early are put on a queue. However, at the end of the process many people who were on the queue do not get to participate.
During the BitTorrent (BTT) token sale, Binance CEO Changpeng Zhao admitted that there were technical issues that delayed the process. At the time, he said that the process took about 18 minutes when it could have ended in seconds.
As Smartereum reported, the Celer (CLR) token sale recently concluded on Binance Launchpad also left a bitter taste in the mouth of unsuccessful participants. Some users wh replied on social media said they logged in as early as 20 seconds into the sale yet could not participate. “Love you Binance but it was a horrible user experience…You logged out people then those who sent in less than 40 [seconds] did not get in,” one user wrote on Twitter.
Binance loosely alluded to the imperfections in the blog. “In a fast-changing world, we listen, learn and adapt,” Binance wrote ahead of the announcement.
Details of the New Lottery Format on Binance Launchpad
According to the announcement, in the new lottery system, participants will be allowed to claim tickets by holding the Binance Coin (BNB) tokens over 20 days leading up to the day of the lottery. The number of tickets users can hold depends on the number of the BNB tokens held for the 20-day period. However, users can hold a maximum of 5 tickets for the lottery at 1 ticket per 100 BNB.
Binance said that the lottery itself will be a transparent and random selection of lottery tickets based on “tail digits”. The BNB held will be deducted from accounts that are chosen by the lottery process after all successful outcomes are fulfilled.
“This lottery model is used by various traditional stock exchanges around the world to ensure fairness and transparency,” Binance explained. Also, standard Know Your Customer (KYC) requirements and country restrictions will be observed.
Risks Associated with the New Lottery Format
Binance admitted the new token format is not perfect due to BNB price fluctuations leading up to a sale. It, however, undermined the overall negative impact it will have o the sale noting that:
“Other market participants may view this as an opportunity, and countertrade to even out the fluctuations.”
Binance Coin [BNB] Price Today /USD
At the time of writing, Binance Coin [BNB] is trading at $17 to the US dollar. The token increased by over 10 percent in the last two days. It has also reclaimed the 7th position on Coinmarkertcap chart displacing Tether and Stellar. The coin market cap stands at about $2.38 billion.
Binance CZ while responding to comments from the announcement explained that the new model is “not set in stone”. He said the Binance team will consider adjusting the system following suggestions in the future.
Riccardo Lopp is a writer specializing in Crypto, ethereum and whole blockchain ecosystem. His background is in economics and statistics.