Author | Lai DaojunSource: LaidoblockchainOn September 2nd, Coin Security announced that it had fully acquired the team and business of the JEX platform, which specializes in cryptocurrency derivatives; The JEX platform will continue to operate under the Binance JEX brand as a wholly-owned sub platform of Binance. The JEX platform currency has surged in response, with a maximum of 7-fold increase in a short period of time
Author | Lai Daojun
Source: Laidoblockchain
On September 2nd, Coin Security announced that it had fully acquired the team and business of the JEX platform, which specializes in cryptocurrency derivatives; The JEX platform will continue to operate under the Binance JEX brand as a wholly-owned sub platform of Binance. The JEX platform currency has surged in response, with a maximum of 7-fold increase in a short period of time.
Surprisingly, the long-standing promotion of the Coin On contract platform was achieved through acquisition. What is the motivation behind Coin On? What is the impact on BNB?
JEX on the brink of death
The JEX platform emerged from the previous cryptocurrency bull market, which was the end of 2017. JEX platform coins completed crowdfunding from December 30 to 31, 2017, and began trading on January 1, 2018. The launch of platform coins also ushered in a small wave of climax.
The main reason for the popularity of the online market is due to the boost of the bull market and its background. There is nothing to say about the bull market, after all, all cryptocurrencies in Rain and Dew have varying degrees of growth, so to speak of its background.
JEX is composed of the original OKCoin core exchange team and has received early investments from well-known blockchain institutions such as HuoCoin and Golden Finance. Among them, Chen Xin, founder and CEO of JEX, and former co-founder/trading platform manager of OKCoin; Wang Hui, founder and CTO of JEX, former co-founder/technical leader of OKCoin; Wu Hao, founder and COO of JEX, former member of the core founding team of OKCoin.
You should know that the three major companies in China (Coin An, Huo Coin, OKEX), the founder of Huo Coin Li Lin, Zhao Changpeng and He Yi of Coin An, all emerged from OKEX.
JEX specializes in the trading of cryptocurrency option products, and although it forms differentiated competition with mainstream futures on other exchanges, this field is still niche. Coupled with the bearish market in the second half of 2018, the JEX platform has been continuously on a downward trend. Despite encountering a hot period of cryptocurrency trading in the first half of 2019, its platform currency has dropped by more than 90% before September 2, 2019.
The platform is approaching the moment of death.
Coin An's acquisition welcomes a surge
On September 2, 2019, Coin An pulled back JEX, who was hovering on the brink of death. Coin An announced that it has fully acquired the team and business of the JEX platform, which means that JEX has become a subsidiary brand of Coin An and is also a derivative brand different from the main station of Coin An that operates spot goods.
The announcement states that while acquiring, Binance will also unify the management of JEX tokens held and managed by the original JEX team and foundation, and provide more usage scenarios for tokens in the future; The above-mentioned tokens will be gradually distributed to all users through community incentives, market activities, and other means in the future, and will be gradually recycled and destroyed through fee deduction, special rights vouchers, and other methods during the operation of the platform.
Stimulated by the acquisition of Coin An, the JEX platform saw a significant increase in coin volume, from around 0.0000001BTC to around 0.0000068, a nearly 7-fold increase compared to the trading pair of Special Coins.
The reason for the rise of the JEX platform currency is obvious. As the world's largest cryptocurrency spot exchange, Coin On itself has a large traffic pool, which is undoubtedly the biggest advantage compared to the current JEX. At the same time, the announcement also states that the JEX platform currency will follow the same path of destroying deflation as the Coin On Ping Taiwan Dollar BNB.
The rise of JEX platform currency seems unstoppable.
What is the impact on BNB
From the perspective of commercial profit seeking, the acquisition of JEX platform by Coin An cannot be aimed at saving JEX platform from chaos, but rather at expanding its business line, expanding its competitiveness in the cryptocurrency market and increasing derivatives trading such as futures. For Coin An ecosystem, it means increasing the equity of its platform currency BNB.
Therefore, we have seen that the announcement by Coin On on September 6th clarifies BNB's rights and interests, and there are four main points to summarize.
1. JEX tokens will be upgraded from the ERC20 network to the coin security chain network, and BinanceJEX will apply for the launch of BinanceDEX;
2. BNB has equal rights and interests with JEX on the BinanceJEX trading platform, including future offset fees and trial options, and enjoys corresponding discounts;
3. Binance JEX will airdrop the unlocked 200000000JEX tokens held by the team to the BNB holding users on the Binance main site, and distribute them according to the holding ratio;
4. Binance JEX will airdrop 30% of its profits to BNB's holding users on the Binance main site on a monthly basis based on its holding ratio. The trial period of air drop is one year, and subsequent adjustments will be made according to the business.
From this announcement, we can see that the rights and interests of JEX platform coins have basically been granted to BNB, and in a sense, JEX platform coins actually have little value.
Why doesn't Coin An create a similar platform on its own?
Due to cost constraints, including technical and labor costs, as well as time costs. To build such a platform, the first step is to have relevant team expenses. The team also needs to have the corresponding technical level, and at the same time, it also requires a lot of time to develop. This process requires expenses before the platform is launched.
However, through acquisitions, there may not necessarily be a need for expenditure. As long as the two announcements are staggered, the time difference that benefits relevant stakeholders may not require the payment of acquisition costs at all. Therefore, we have seen the announcements on September 2nd and September 6th. This operation can basically obtain a platform and technical team for free, why not.
Of course, Coin An can also issue a platform coin to raise funds first, and then conduct research and development to create a similar platform. However, this approach gives the public the impression of inflation and dilutes BNB's rights. It's also possible that Coin An doesn't want to incubate another token at all.
It can be seen that the acquisition of JEX by Coin An was a result of foresight.
Summary: Coin An's acquisition of JEX may lead to a short-term surge in JEX platform currency, but it is basically unsustainable because Coin An mainly maintains the value of BNB.
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