Crypto Exchange Listing: Why Is it Important and How Does It Affect Token Price?

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When a digital currency or token is added to a crypto exchange, it becomes available for users to trade and invest in. This often increases the token’s popularity, especially if it’s a large exchange with many users from all around the world. The token listing also serves as a powerful marketing tool because when a new token is added, it’s officially announced. This announcement is usually covered by the media, acting as a way to promote the token and attract attention from potential investors.

How Coin Listing on Exchange Builds Trust Among Investors

Here are the steps to complete before you list token on exchange:

  1. Preparation and documentation
  2. Submission of an application
  3. KYC and AML procedures
  4. Community engagement
  5. Marketing strategy
  6. Post-listing strategy.

Listing on an exchange is a serious indicator of the project’s reliability. Let’s see an example. You launched a blockchain project and held an ICO, selling your tokens to early investors and raising a significant amount. The project is still under development, and as time passes, investors start to express concerns about the real value of the assets they have bought.

You need to generate a true value for your token to retain investors and the reputation of your project. This can be done through demonstrating demand for the token, which is possible by introducing your asset to the market. You can do this if you list your coin on exchange. 

How Crypto Exchange Listing Affects Token Price

Once the news about the listing is published, the token price starts to grow. According to an eToro study (based on the data taken from 2020), digital assets that were listed on an exchange with pre-announcement, had their price surging to around 50%. There was a 6-day interval between the news about the listing and the listing itself. During that period, each asset’s price grew up to 43% plus around 7.5% right on the listing day. In certain cases, the price surge extended even further, reaching an impressive 85% during the six-day interval between the announcement and the listing. 

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The surge in token prices during this period can be explained by heightened market anticipation. The pre-announcement generates excitement and interest among investors, leading to increased demand. As the listing day approaches, this anticipation often translates into a surge in buying activity, causing the token’s price to rise.

Token listing on an exchange has a substantial impact on its price, with pre-announcement periods often leading to significant surges. This explains the role of forming market anticipation and strategic communication in shaping the perceived value of a listed token.

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