Original author: 1912212.eth, Foresight News
At the end of 2024, Binance launched a new feature - Binance Alpha. This module embedded in the Binance wallet, on the surface, is just a platform for displaying early projects, attracting users through airdrop activities and convenient trading functions. In fact, its influence goes far beyond this. Binance Wallet, BNB Chain, Binance Exchanges spot market and contract market have all undergone subtle but profound changes due to the emergence of Alpha.
As of now, according to Dune data, the number of transactions has doubled since April 21 compared to last week, and the number of transactions per day has hit a record high. The total transaction volume of Binance Alphas BNB Chain has risen to US$480 million, and the total number of trading accounts has reached 715,000.
What does Binance Alpha mean to Binance? What is the operating logic behind it?
Binance Alpha: The Birth and Operation Mechanism
Binance is no longer satisfied with being the worlds largest cryptocurrency exchange. It hopes to become the central hub of the Web3 ecosystem, connecting CeFi and DeFi. Coupled with the current markets disappointment with the wealth effect and the various controversies over Binances listing of tokens, Binance Alpha came into being. It is positioned to discover and promote early projects. The Binance team selects some potential stocks from a large number of projects and puts them in the window of Alpha for users to purchase directly through the Binance wallet.
The charm of Alpha lies in its convenience and incentive mechanism. Users can directly purchase Alpha project tokens with main chain tokens such as BNB, ETH, and SOL through the exchange function in the Binance wallet. Compared with the complex operations of other DEXs, the exchange function makes transactions smoother and has a higher success rate by automatically adjusting slippage and anti-MEV (maximum extractable value) mechanisms. Even more attractive is Alphas airdrop event, where users have the opportunity to receive additional rewards whether they participate in transactions or hold specific tokens.
Some users shared their experiences of frequently operating Binance wallets for airdrops. This earn while playing model not only lowers the threshold for ordinary people to access Web3, but also makes Binance Alpha a new growth point for Binances ecosystem. Although the Alpha project is not guaranteed to be listed on the Binance exchange, its high exposure and potential opportunities are enough to attract investors.
Alpha promotes wallet activity
In the past wave of inscriptions, OKX Wallet was once highly praised for its user experience and support for inscriptions. In contrast, Binance Wallet was questioned, and its user experience was not friendly enough, which became its biggest fatal flaw.
As the bridge between CeFi and DeFi in the Binance ecosystem, Binance Wallet has long had a somewhat vague positioning - it is neither as focused on decentralization as Trust Wallet, nor is it entirely an auxiliary tool of the exchange. The emergence of Binance Alpha seems to be reversing this situation. It has injected new vitality into the wallet and has become the preferred entry point for users to access Web3.
Alphas airdrop activities and early project investment opportunities attracted a large number of new users to download and register Binance wallets. In order to participate in the Alpha project, investors specifically deposited BNB, ETH or SOL in their wallets, driving the growth of both asset stocks and trading volume. This user growth is not only reflected in quantity, but also in activity. In order to obtain airdrop rewards, users frequently transfer money, exchange tokens, and even play with multi-account mode, which once caused Binance to continuously increase its participation threshold and restrictions.
On April 25, the latest version of Binance App launched the Alpha Point rating system. According to the official explanation, the system is used to evaluate the users activity in the Binance Alpha and Binance Wallet ecosystems, and determine whether they are eligible to participate in activities such as Wallter TGE and Alpha token airdrops. Binance Alpha points are calculated daily based on the users asset balance in Binance CEX and Binance keyless wallet addresses in the past 15 days, as well as the sum of the number of Alpha tokens purchased. Currently, selling Alpha tokens will not contribute Alpha points.
The latest 12th Binance Wallet TGE project OKZOO has begun requiring participants to have at least 45 points.
Alpha has driven a surge in on-chain activities within the wallet. More importantly, compared to 2024, the user experience of Binance Wallet has been continuously optimized. In addition, Alpha has also enhanced the synergy of Binance Wallet in the ecosystem. Users deposit main chain assets in their wallets and participate in Alpha project transactions, which not only increases the asset liquidity of the wallet, but also promotes interaction with BNB Chain and others. This cross-platform flow of funds has evolved Binance Wallet from a simple storage tool to an active node in the Web3 ecosystem.
Building a “test field” for the coin listing system
In this cycle, given that most VC coins peaked when listed on Binance, and the wealth effect is extremely weak, Binance is becoming more cautious about directly listing tokens, and is also exploring new traffic entrances. Under the MEME wave, many wealth codes often appear on the chain. In view of this, the combination of Binance Alpha and wallets has become a test field for the spot and contract markets.
As a pre-listing observation area, Alpha provides potential candidate projects for listing in the spot market. Although there is no guarantee that the Alpha project will be listed on the exchange, its screening criteria are highly consistent with the listing process of the exchange, allowing investors to see potential opportunities. Many users believe that trading Alpha projects in the Binance wallet can increase the weight of obtaining exchange airdrops. This expectation directly stimulates trading interest in the spot market. Users may buy BNB or other main chain tokens in the spot market and transfer them to their wallets to participate in Alpha activities, thereby pushing up trading volume.
The community enthusiasm of the Alpha project has also brought additional volatility to the spot market. When a project is launched on the Alpha section, its token price often fluctuates wildly due to airdrop expectations or short-term speculation. This volatility provides opportunities for short-term traders and drives the activity of the spot market. More importantly, Alpha enhances the transparency of the exchange listing process by disclosing screening criteria and project information. This increase in transparency and trust has not only attracted retail investors, but also made institutional investors pay more attention to the potential listing opportunities of the Alpha project.
The launch of Binance Alpha has brought new trading opportunities to the contract market, but also comes with higher volatility and risk. The short-term volatility and community popularity of the Alpha project make it an ideal target for contract trading. Historically, Binance Launchpool projects have often entered the contract market quickly after listing, and the Alpha project has similar potential. Binance contracts support up to 125x leverage, and short-term traders can capture price fluctuations during the launch of the Alpha project by going long or short. Alphas 24-hour display mechanism and airdrop activities further amplify this volatility and inject new vitality into the contract market.
However, high volatility is also a double-edged sword. Leveraged trading in the contract market amplifies risks, and ordinary users may suffer heavy losses in pursuit of short-term profits. Binance is aware of this and has added risk warnings and educational content to the promotion of Alpha, reminding users to be cautious in participating in high-leverage trading.
summary
The launch of Binance Alpha is a bold attempt by Binance. It is not only a platform to showcase early projects, but also a catalyst for the Binance ecosystem. Binance Wallet has become a popular entrance to Web3 because of Alpha, BNB Chain has benefited from Alpha, and even played a certain supporting role in the price of BNB. The spot and contract markets have benefited from the popularity of the project and active transactions.
However, Alphas success is not without challenges. The quality of early projects varies, and high volatility may discourage some users. From a broader perspective, Binance Alpha is Binances bridge between CeFi and DeFi, and is also its strategic layout to seize the initiative in Web3. In the future, Binance needs to further optimize the screening mechanism, strengthen user education, and ensure the long-term value of the Alpha project.
