Scammers call for orders, where are the good things?

$THE

What is VC Coin, and why is it not recommended for investment?

In recent years, VC Coin has sparked widespread controversy in the market, but many people do not have a deep understanding of it. The following takes $THE as an example to analyze the characteristics and risks of VC Coin:

Definition and Characteristics of VC Coin

VC Coin is a token led by venture capital institutions (Venture Capital, abbreviated as VC), typically possessing the following characteristics:

1. Projects that seem “high-end” but are not
Compared to meme coins, VC Coins are usually packaged as having actual projects, making it easy for people to mistakenly believe they have long-term investment value.

2. Eye-catching institutional background
There are many well-known institutions investing behind it, and the strong background is used as a selling point in promotions to attract investors.

3. Extremely low circulation, artificially inflated market value
The initial circulation is very low, but the market value is artificially inflated, creating a false sense of high valuation.

Potential Risks of VC Coin

1. Unlocking mechanism leads to price decline
Taking $THE as an example, 940,000 tokens are unlocked weekly; early investors acquire tokens at a low cost, and large sell-offs after unlocking lead to a continuous decline in price.

2. Extremely low early financing costs
Institutions participate in financing at extremely low prices, easily profiting after sell-offs, while ordinary investors often get trapped after buying at high prices.

3. Negative impact on the market
Unlocking and selling not only harms investor interests but also siphons off market liquidity, dragging down the performance of other quality tokens.

Why are VC Coins disliked?

VC Coins typically exhibit “loud thunder, little rain,” exaggerating actual value in promotions but performing poorly after going live, with prices continuously falling and almost no rebound before the unlocking period ends. Meanwhile, some exchanges continuously list VC Coins to collect listing fees and cooperate with private placements, further exacerbating the market harvesting effect.

Conclusion

The essence of VC Coin is to harvest ordinary investors through low circulation and unlocking mechanisms. Investors should be wary of the inflated valuation and unlocking pressure of VC Coins to avoid becoming the harvested “leeks.”