Imagine you know some great coin with so many use cases and huge potential but that coin isn't listed on a good exchange with good volume and liquidity. If you recommend that coin to an experienced investor, it is highly unlikely for him to buy that coin because no one would like their money to be stuck somewhere.
That's right, there are plenty of exchanges out there with no liquidity and volume and whenever you move your money there, chances are that it will be stuck as you might able to sell a coin at your market price.
Besides this problem, coins do not reach their true potential if they are just listed on small exchanges. There are always exceptions but this is true most of the time.
Let's take an example of Balancer (BAL). This coin wasn't listed on Tier 1 exchanges until yesterday. I had bought this coin at $8 and $10 by the dollar-cost average method. I held this coin for over 2 months and there was no price appreciation. I had bought it on MXC exchange and while this exchange claims that it has a volume of millions of dollars, in reality, it isn't even $10k.
Balancer got listed on Binance yesterday and saw tremendous gains just after the listing was announced. Huobi also listed Balancer today which added fuel to the fire and Balancer is burning real hot right now at almost $27. That is a 3x on my investment.
You won't find the real trades on small exchnages, for that you have to be on Binance, Huobi, Okex, and other popular exchanges with good volume. Also, many people get to know about a particular coin only after it is listed on a big exchange and if it is not on a big exchange, they won't buy it.
Tier 1 exchanges also provide investors and traders an element of trust to invest in a particular coin as mostly big exchanges do their homework before listing a coin.
What do you think about exchange listings? Do let me know in the comments section.
This is not financial advice. These are personal thoughts and they are meant for information purposes only.DYOR before investing.