Delisting

All of the exchanges have their unique standards for listed assets. Whenever a particular stock, currency, or cryptocurrency fails to provide all of the matters in the standard, the market delists that specific asset. In the case of cryptocurrencies, there are many markets, such as Binance or Coinbase Exchange. These exchanges also regulate their listed coins like the real world to delist those that do not meet the standards. These standards are requirements for listing the coins in the first place. Therefore, a delisting action is expected whenever the coin’s standards don’t comply with the exchange’s standards.

See before moving on: The Most Popular Cryptocurrency Exchanges for Traders

Types of Delisting

There consists of two types of delisting for the exchanges.

Voluntary requests for delisting

Companies can choose to become delisted in the exchange. In these cases, the companies or teams behind cryptocurrencies request a delisting to the exchange. This action can happen for several reasons, such as the cryptocurrency managers deciding not to continue with the project.

Involuntary delisting

If the cryptocurrency standards are not complied with, exchanges usually send a warning to the company. If the company keeps non-compliance, then the delisting occurs involuntarily.

The reasons for Involuntary Delisting

As mentioned before, the standards of the exchanges are the rules that companies must follow if they want to stay in the market. There are several reasons of these rules do not comply with companies. For example:

• The company went bankrupt
• The low trading activity: If the cryptocurrency has significantly low trading in the exchange, the exchange can delist the coin for lack of attraction. The low volumes are one of the most common reasons for the delisting of cryptocurrencies.
• Having a network that does not function properly: It is essential to have a cryptocurrency project that works. Therefore, it is also one of the common reasons for delisting.
• Security issues: If the exchange decides that the cryptocurrency project is open for security breaches and their users are in danger, exchanges can delist the coin.
• Not having the proper protocols for development

Have a look at the latest delisted cryptocurrencies.