Bitget, one of the world’s top-10 cryptocurrency exchanges, has decided to cease the long-term development of its platform token, Bitget Token (BGB), and will transfer control of 440 million BGB tokens to the Morph Foundation. This move comes despite an audit revealing significant security vulnerabilities within the Ethereum Layer 2 network, Morph, which aims to revolutionize on-chain consumer finance.
In a recent press release, Bitget outlined its plan, stating that half of the token transfer—approximately 220 million BGB—will be burned immediately by Morph. The remaining tokens will be released gradually at a rate of 2% per month to support liquidity incentives, expand use cases, and educate the community. Originally launched on Ethereum in 2020, BGB is set to become the native token for Morph, serving as its gas and governance token.
Gracy Chen, Bitget’s CEO, expressed confidence in the decision to transfer the tokens to Morph, emphasizing that this shift aligns with the vision of involving community and ecosystem developers in BGB’s future. Chen remarked that this move underscores BGB’s evolution beyond being merely an exchange token, with Morph being a natural fit due to its focus on payments and consumer finance.
Bitget is keen to reposition itself, distancing from direct control over the asset’s developmental roadmap. The Morph Foundation will assume responsibility for guiding BGB’s future, allowing Bitget to focus on enhancing its core services. Chen highlighted the necessity of prioritizing real-world payment applications for Bitget’s user base.
Following the announcement, BGB experienced a temporary price surge, jumping 10% to $5.20 before retracting to below $5. Currently, BGB boasts a market capitalization of $5.78 billion, making it the 38th largest cryptocurrency by market cap.
However, concerns about the security of the Morph network have arisen. Data from L2BEAT indicates that Morph has serious vulnerabilities, including potential exploits related to code upgrades, inadequate fraud-proof mechanisms, and dangerous centralization risks. Specifically, the network operator has excessive control, allowing for possible fund misappropriation and transaction censorship.
Bitget acknowledges these vulnerabilities but asserts that they are aware of the mutual challenges faced by new Layer 2 networks. Chen claims Morph has already implemented solutions to address several concerns flagged in the audit, although these may not be recognized by L2BEAT’s criteria. Bitget remains committed to supporting the Morph ecosystem while prioritizing user protection.
In a related context, earlier ventures in the crypto space, such as a $20 million funding round led by Dragonfly Capital for Morph, have positioned the network for future growth, adding to the competitive landscape where exchanges like OKX have also shifted their platform tokens to new Layer 2 solutions.
