PANews reported on December 3 that former BitMEX CEO Arthur Hayes published a new article analyzing the development trends of the cryptocurrency market and the potential reasons for the return of ICOs (Initial Coin Offerings) to the market.
Since the ICO boom subsided in 2017, the way capital is formed in the crypto market has gradually deviated from the original path. VC-backed tokens have not performed well in this bull market, with new tokens in 2024 showing nearly a 50% performance drop compared to mainstream coins. At the same time, the model of high FDV (Fully Diluted Valuation) and low circulating supply has also failed to meet the demands of retail investors.
Hayes believes that the ICO model has significant advantages. The modern framework supports rapid token issuance and trading, providing good timeliness; the development of DEX has provided projects with ample trading environment and liquidity; and the lowering of entry barriers for crypto wallets and improvements in blockchain performance have greatly enhanced user experience.
For project teams and investors, Hayes advises caution regarding VC-backed projects with high FDV and low circulating supply, while also being wary of overvalued tokens listed on centralized exchanges. He emphasizes not to easily accept viewpoints that label trading behavior as 'irresponsible,' but rather to make judgments based on the actual market situation.