Crypto exchange tokens are often annoying, predatory, and a bad deal for customers. And worst of all, leads to exchanges running risky Ponzi-like structure with their tokens

I am really starting to hate exchange tokens. A lot of the time, you would realise that these exchange tokens often little to no additional value to customers besides forcing the to buy and hold some random token with very dubious value. Much of the time it only offers the value of pumping the pockets of exchange owners, execs and staff.

There are indeed some legitimate used of platform tokens, such as a lending platform that allow borrowing and lending in their token as a way to provide extra functionality to these loans. There are also tokens that platforms used to reward users such as interest on loans or as a token for governance voting.

However, the vast majority of the time, exchange force you to hold tokens in at attempt at dangling some extra value you can achieve in exchange for holding their token(pumping their pockets). Consider how Binance uses their BNB token, such that if you trade in BNB pairs/hold BNB, you receive trading fee discounts.

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The thing is that all exchange reward you for high trade volumes. This is because the more you trade the more fees they make. There's really no need for BNB. Binance could have just rewarded you for high volume but instead they ALSO force you to hold BNB to receive the discount.

You can compare this to Kraken. Here you'll see that as long as you hit the volume threshold, you get the benefits. No sketchy token required.

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There's of course a lot of question surrounding potential manipulation of BNB, as well as many of exchange tokens. FTX managed to get away with running a Ponzi for years. And there's a 100% chance in crypto that other exchanges are doing them same, and unwitting poor retail will be left with the bag.

There was also the infamous case of CryptoDOTcom card rewards where customers had bought and locked up tons of CRO for what seemed like reasonable rewards at the time. CDC later heavily slashed card rewards such that customers pumping CRO was all for naught. On top of that, CRO also took a heavy dump around the same time.

To me it seems like all these exchange tokens are equivalent to corporations pumping their stock, running a trash company and selling out using insider knowledge when the company badly underperforms or outright crashes.