Decrypting the platform coin track: How can WXT replicate the hundredfold miracles of BNB and BGB?

ChainCatcher Selection
2025-01-24 15:33:17
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Value capture ability + growth potential = room for platform token appreciation

Author: Sissie, ChainCatcher

In the ever-changing cryptocurrency market characterized by sector rotation, centralized exchange platform tokens lead in annualized returns. As one of the most mature business models in the crypto space, exchange tokens serve both investment purposes and allow participation in mining, DeFi, and other ecosystems of the exchange, while also directly empowering investors through reductions in trading fees. Conversely, platform tokens further unify the interests of retail investors and exchanges, becoming an important means for exchanges to acquire customers and build ecosystems.

Annualized returns narrative for 2024:

As of January 22, 2025, the total market capitalization of centralized exchange platform tokens has reached $138.1 billion. According to Coingecko data, there are currently 58 types of centralized exchange platform tokens. Among them, BNB holds the top position with a market cap of $101.1 billion. Bitget's platform token BGB increased by over 100% last year, ranking third and becoming one of the fastest-growing platform tokens of the year. In contrast, the WEEX exchange platform token WEEX Token (WXT), which was launched in July 2024, currently has a circulating market cap of only $7.853 million, less than 1% of BNB, which is inconsistent with the rapid growth of WEEX's user base and trading volume, creating a value gap for the platform token.

Following the power of platform tokens, exploring the successful paths of leading platform tokens and seeking opportunities in potential platform tokens may represent a higher risk-reward investment strategy.

Hexagonal Warriors: The Core Functions of Platform Tokens

Exchange platform tokens have numerous functions, which can generally be categorized into three aspects: optimizing trading experience, broadening sources of income, and expanding the community.

The most direct function of platform tokens is to serve as the "points system" of the exchange, allowing users to exchange for discounted trading fees and gain access to other advanced trading services. For project teams, holding a certain amount of platform tokens is essential to list on the exchange. For exchanges, their own platform tokens can increase revenue and attract users. From this perspective, the demand for platform tokens is directly positively correlated with the total trading volume of the exchange.

Platform tokens can also expand the ways users earn income within the exchange ecosystem, such as purchasing financial products within the platform, participating in the exchange's Launchpool to earn mining or airdrop rewards, etc. As an investment in the exchange, platform tokens themselves will appreciate with the development of the exchange, making them "blue chips" in the crypto market.

Platform tokens are also an important channel for exchanges to connect with users and communities. Most platform tokens have a burn mechanism, akin to a share buyback by a listed company, returning trading fees to platform token holders. By participating in trading on certain platforms, platform token holders can engage in the community and take part in the decision-making process for every issue and resolution.

The Success Trajectory of BNB: From a Token to the Center of the Exchange Ecosystem

As the pioneer of platform tokens, many of the functions of platform tokens can be traced back to Binance. Zhao Changpeng founded Binance in July 2017. In the same month, the native token, Binance Coin (BNB), was created through an Initial Coin Offering (ICO), raising $15 million by issuing 200 million tokens. Initially, it was an ERC-20 token based on Ethereum, interoperable with existing Ethereum wallets and infrastructure. In April 2019, Binance announced the launch of its own blockchain network, Binance Chain, and migrated BNB from the Ethereum network to Binance Chain. This marked a significant transformation for BNB, turning it into the native cryptocurrency of Binance Chain.

Since its launch in 2017, BNB's price has experienced rapid growth, primarily due to the continuous expansion of the Binance exchange and the growing user base. The functions of BNB have also been continuously increasing; it has not only become the center of the Binance ecosystem but is also gradually expanding beyond the ecosystem.

Within the Binance ecosystem, BNB plays an important role on the exchange and Binance Chain:

  1. Users can use BNB to pay trading fees on Binance and Binance DEX, enjoying a 25% discount (which will gradually decrease over time).

BNB Holdings and Binance Membership System:

  1. Pay trading fees on Binance Chain and Binance Smart Chain. BSC further elevates BNB to a PoS token, achieving a new PoSA (Proof of Staked Authority) consensus driven by validators and delegators.

  2. Power hundreds of projects running on Binance Smart Chain. Use BNB for trading in DeFi, liquidity pools, decentralized exchanges (DEX), or as a payment tool in NFT markets.

  3. Binance Wealth Management, where users can use BNB to purchase various independent products such as Staking, Launchpool, BNB Vault, or Liquid Swap, providing a great source of passive income.

  1. Crypto payments, the Binance Card is a cryptocurrency Visa debit card that allows users to pay for shopping, bills, mortgages, and almost anything else using BNB. BNB can be used for payments at over 40 million merchants worldwide.

  2. As collateral, quickly obtain simple and direct cryptocurrency loans without hidden fees or costs. Collateralizing BNB allows users to borrow BTC, ETH, BUSD, USDT, etc., with loan terms ranging from 7 to 180 days.

Outside the Binance ecosystem, BNB is striving to expand its role as a daily payment currency. For example, through Travala.com, users can purchase airline tickets, pay for hotel expenses, and even rent cars using BNB. Hundreds of online vendors and merchants accept BNB as payment for goods or services.

Among these, the financial role of BNB backed by the Binance exchange and Binance Smart Chain is worth detailing, with Binance Launchpad and Launchpool being the most representative.

Binance Launchpad was established in 2019 to introduce a new method of cryptocurrency crowdfunding. Binance Launchpool was launched in 2020, allowing users to lock their assets to earn new assets in return. Binance was the first platform to introduce Initial Exchange Offerings (IEOs).

CapitalismLab has recorded the BNB-based returns from 2021 to May 2023, showing that the annualized returns from BNB Launchpad can actually be benchmarked against ETH staking returns. Over approximately two and a half years since 2021, if tokens were sold on the first day, the total return rate based on BNB would be 36%, with an annualized return of 14%, slightly higher than the ETH staking returns during the same period. If the returns from Launchpool mining and selling are added, the total return rate based on BNB would be 52%, with an annualized return of 21%, which is more than twice the ETH staking returns during the same period.

Although discussions about Binance LaunchPad have never ceased in the market, it cannot be denied that the past wealth effect has gradually pushed BNB to the center of the ecosystem.

At the same time, to give back to the community, BNB has a burn mechanism. There are two methods for BNB burn: BNB Quarterly-burn (quarterly BNB burn) and BEP-95 - burning a portion of BNB as gas fees on the BNB chain. In December 2021, Binance officially launched the BNB automatic burn mechanism, replacing the original quarterly BNB burn mechanism. The BNB automatic burn method will automatically adjust the amount of BNB burned based on BNB price and supply-demand fluctuations. This means that if the BNB price drops, the amount of BNB burned will increase to ensure balance. As of January 23, 2025, a total of 2,141,487.27 BNB has been automatically burned.

Through the integration of exchanges and ecological chains, BNB has become the sixth largest currency by market capitalization in the crypto space, with a growth rate of 135.45% over the past year.

Value Capture Ability + Growth Potential: Finding Value Gaps in Platform Tokens

By reviewing the price increases of platform tokens over the past year, we find that besides BNB, BGB has performed outstandingly, with value capture combined with growth potential being the main factors for the significant price increase of emerging platform tokens.

Bitget Token (BGB) is the only platform token for the Bitget centralized exchange and Bitget Wallet decentralized ecosystem. Similar to BNB, BGB also has multiple ecological rights, including: staking BGB through Bitget Launchpool to receive airdrops of popular tokens; using BGB to participate in Bitget PoolX to earn passive income; holding BGB to receive airdrops of on-chain tokens from Bitget Wallet Fair Launchpool; participating in early subscriptions for potential projects using BGB through Bitget Launchpad; using BGB to pay for Bitget spot trading fees with a 20% discount; staking BGB to enjoy free withdrawals from Bitget daily; holding BGB to upgrade Bitget VIP levels and unlock more benefits; and Bitget trading experts holding BGB can unlock up to 10% of the profit from copy trading.

From the perspective of value capture, Bitget's user and trading volume growth has been rapid. At the beginning of 2023, Bitget's market share was only 2%, but now its derivatives share has risen to 12.73%, and its spot share has risen to 3.67%. Through a more aggressive listing strategy and quality product services, Bitget has risen against the trend in the bear market, capturing more value for its platform token.

From the perspective of growth potential, based on the horizontal ecological advantages of the original Bitkeep wallet, ForesightNews, and Forsights Ventures, BGB has ample room for ecological expansion. In terms of on-chain applications, BGB will be deeply integrated with Bitget Wallet application scenarios, such as using BGB to pay on-chain gas fees and participate in on-chain staking; in terms of payments, BGB will be deeply integrated with Bitget Pay, Bitget credit card, and other payment solutions, allowing direct payments in various consumption scenarios such as restaurants, travel, gas, and shopping.

At the same time, on December 27, 2024, Bitget announced it would burn 800 million BGB tokens held by the core team in one go, accounting for 40% of the total supply of BGB. After the burn, the total supply of BGB will be reduced to 1.2 billion, and it will be 100% fully circulated. Additionally, BGB will initiate quarterly buybacks and burns starting in 2025, with Bitget using 20% of its quarterly profits from exchange and wallet operations to buy back and burn BGB. The token burn acts as a reassurance to the community.

The value capture and growth potential are directly reflected in the price of the platform token. On July 26, 2021, BGB was officially launched at an initial price of 0.0585 USDT. In just over three years, BGB's highest price has exceeded 7.9 USDT, with a cumulative increase of over 100 times.

The Next BGB: The High-Growth, Undervalued Potential Platform Token WXT

WEEX Token (WXT) is the platform token issued by the WEEX exchange. By holding and using WXT, users can enjoy trading fee discounts, receive new project token airdrops for free, gain priority participation in new listings, and access other value-added services.

From the perspective of value capture, the user base and trading volume of WEEX exchange have also surged, currently ranking fourth among derivatives exchanges according to Coingecko. According to real-time data from CoinMarketCap, WEEX's trading volume ranks sixth among derivatives exchanges. Currently, WEEX has over 5 million registered users, covering more than 30 countries and regions globally, with an average daily trading volume exceeding $1 billion. The platform began achieving stable profits as early as the "crypto winter" of 2022 and has maintained a high growth rate of 100% in monthly trading volume. It offers over 700 perpetual contracts, more than Binance, Bybit, and Bitget, and has 826 spot trading pairs.

Moreover, both the fee reduction and financial functions of WXT are stronger than those of BNB and BGB. WEEX is one of the exchanges with the lowest fees in the market, currently allowing the largest holders of WXT to enjoy up to a 70% discount on trading fees.

WE-Launch (formerly Launchpool) is one of the important use cases for WXT, where WXT holders can receive free airdrops of tokens from popular projects before they launch. So far, WEEX has launched 67 WE-Launch projects, with annualized returns for projects like LTD, BA, NEIRO, THR, and FLOKI exceeding 200%, and NEIRO reaching as high as 402%.

In the future, WXT holders will have priority participation in new coin issuances on WEEX Launchpad. According to WEEX's 2024 WE-Launch and airdrop plan, the annualized return for WXT holders could reach as high as 140%.

"Sunshine" is another exclusive benefit for WXT holders, with periodic airdrops of popular project tokens, USDT, and contract experience funds. So far, WEEX has conducted 7 "Sunshine" events, cumulatively airdropping 90,000 USDT and 110,000 USDT in experience funds to WXT holders.

It is worth noting that, unlike other platform token activities, users can participate in WE-Launch and "Sunshine" without locking or staking WXT; they only need to sign up at any time during the event period to successfully participate, and the WXT held by users can be traded or withdrawn at any time after participation.

From the perspective of growth potential, in 2023, WEEX began localized operations in the Korean and Vietnamese markets. In 2024, WEEX hired former MEXC Global VP Andrew Weiner as VP, leveraging Andrew's extensive industry resources and market experience to accelerate the expansion into the North American market.

WEEX holds multiple financial compliance licenses. With a rich selection of trading currencies, top-notch depth experience, and ultra-low fee advantages, WEEX has attracted communities such as K9 Finance DAO, BleedingCrypto Community, and SamPrice Community to become channel partners, leading to rapid growth in its global user base. At the same time, WEEX has launched the WEEX Masons program targeting global crypto influencers to further expand its channel partner network.

WXT has a total supply of 10 billion tokens, with an issuance price of $0.01 and an initial circulating supply of 3.9 billion tokens. Among these, the investor safety fund accounts for 25% and is not locked; the partner ecosystem fund accounts for 15% and will be released over 5 years; the remaining tokens will be released linearly over 10 years.

WXT is designed as a global ecological incentive token, with 60% of the tokens allocated to active users, partners, and team contributors, and a lock-up period of up to 10 years, covering at least two full crypto bull and bear cycles; the remaining 25% (investor protection fund) does not have a lock-up period, but this portion of funds is clearly intended for long-term holding and will only be used to compensate users for unexpected losses in case of extraordinary circumstances. This means that there is no release pressure for WXT in the short term.

At the same time, WXT adopts extreme deflation, with 90% of WXT being bought back and burned. The white paper promises that WEEX will regularly use a portion of the platform's profits to buy back WXT from the secondary market and permanently destroy it until the total supply is ultimately reduced to 1 billion tokens. The top-tier strength and rapid growth provide a solid guarantee for the buyback and burn of WXT, while the 90% deflation target indicates that WXT will appreciate tenfold based on a reasonable market valuation.

In horizontal comparison, BNB has a market cap of over $100 billion, with a maximum increase of 395,147% since its launch; BGB has a market cap of $8.4 billion, with a maximum increase of 2,174%. Currently, WXT's fully diluted market cap is only $31 million, with a maximum increase of only 187.72%. Given WXT's current price increase, everything is just beginning.

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