Cryptocurrency exchange giant OKEx has announced that it has launched its own utility token, likely in a bid to siphon market share away from Binance.
The Hong Kong-based OKEx made the announcement on Saturday, revealing that the launch was timed to correlate with the Chinese New Year.
The exchange said that, among other things, OKB tokens can be used to settle trading fees, as well as obtain access to exclusive services including dedicated customer support and enhanced API rate limits.
Initially, OKB will be structured as an ERC-20 token and run on the Ethereum blockchain. However, interestingly, the company said that it plans to eventually launch its own public blockchain, tentatively named OKChain.
“OKB will be accepted on OKEx and will be a vital piece of OKEx’s architecture & development,” the company stated in a press release. “We aim to build a sharing community with blockchain technology, allowing every user to participate and contribute to the development of our platform.”
The move is likely a bid to compete with Binance, an exchange that bootstrapped its development through an initial coin offering (ICO) last year.
Despite launching just months ago, Binance has already become the undisputed leader in trading volume among exchanges that only offer cryptocurrency-to-cryptocurrency trading pairs. Within the past 24 hours, Binance has processed more than $2 billion worth of trades, while OKEx, the fifth most popular exchange, has seen about $1.3 billion in volume.
One reason for Binance’s meteoric ascent is the fact that BNB, its utility token, provides users with discounted trading fees. This not only increases liquidity but also ensures customer loyalty, since the tokens cannot be used on other platforms.
Similarly, OKEx’s token will likely be distributed through an ICO-style token generation event, but the company has been tight-lipped on the details of this distribution.
However, the exchange did reveal that it will distribute an initial round of 100 million OKB through a giveaway this week. Through Feb. 14, all users who achieve at least 5 BTC worth of trading volume will receive a random amount of tokens, ranging between 10 and 1,000 OKB.
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