Interpreting Binance Pre-market: Another Declaration of War on High Market Value
Binance announced the Pre-market. At first glance, I thought it was just a common pre-market. But after reading the rules carefully, I found out that I was wrong. Its purpose is not to earn more transaction fees, but another important attempt to eliminate high-market-value projects.
It seems to be a consensus that once a project is listed on Binance, it will have a high market value. After the TGE, the leeks were harvested, Binance was criticized, and only the project owner and the young models on the yacht were laughing. What's more terrible is that the project owner made enough money and started to lie down all the way.
So what is the difference between Pre-market and Launchpool? Why is it possible to break this phenomenon? The key is that the chips in Pre-market are only allocated by Launchpool, which means that there are no chips from project parties and market makers, nor are there any rat warehouse chips in the name of airdrops. Let the community set the price and eliminate high market value.
Let's first talk about the current gameplay of the project party. Before listing, they first set up a game, an excellent and hard-working team, top VC investment, a grand narrative, and data contributed by the Mao Mao Party. Then wait to be favored by the lucky hand of "God". Then everything began to change. At the opening, the project party has strong control. They have sufficient chips in their hands. The market makers working for them have rich trading experience, the most first-hand capital data, and a pure grasp of the human nature of gamblers. In addition, for the airdropped chips, the project party can use methods such as server crashes to control the rhythm of the chips rushing into the exchange. They are like God with all-powerful hands and eyes, and have a crushing advantage against leeks. On the opening day, the project party can make a lot of money.
If you often read my Twitter, you will know that I have disclosed many times that many project parties cashed out a lot on Binance when the market opened. The proportion is exaggerated. If Launchpool accounts for 5% of the total, the project party can sell 5% or even more. The cash out starts at at least 50 million US dollars. For projects with good market conditions and good liquidity, it can exceed 100 million US dollars. The root of all this comes from the fact that when the market opened, the project party, together with its good friend the market maker, used the advantages of funds and chips and rich experience to control the pricing power of the currency price and sell at a high market value on Binance.
When the Pre-market is launched, this set of gameplay will be broken. Pre-market in other places is a means of trading in advance with money on the exchange, and there is no actual token. But in Binance's Pre-market, what is traded is the chips of Launchpool. So these chips are in the hands of users who participate in Launchpool. From the previous few times, the number of participants in Launchpool is 1 to 2 million. So these chips are relatively scattered, and it is not easy to form a centralized control system. And from my own psychological speculation, Launchpool is a free currency, it is nothing more than a question of whether the pig's trotter rice is luxurious, so the price sensitivity is not high. In this way, the market value at the opening will not be very high.
In the Pre-market, there are only Launchpool chips, and the project party and market makers cannot participate. We know that at the beginning, we were a family with the project party, walking together, building together, and looking forward to the stars and the sea together. But once we were listed on Binance, the project party became a complete scumbag. He only wanted to sell us coins at a high price so that he could go to a yacht party with his nm sister. We still want to build, and still think about the stars and the sea. Now there is a Pre-market, and this scumbag can't manipulate the price through financial advantages, chip advantages, etc. Therefore, we are buying and selling sincerely, and we are honest and fair. And Binance sets a position limit to prevent the price from being affected by large investors/or malicious people. In other words, the Pre-market is a market where the community fully prices, not the project party. Then it is inferred from common sense that the project party wanted to open the market with a high market value to ship. Now that there is no influence on the price by the project party, the market value of the project in the Pre-market will definitely decline.
Once the Pre-market has a price, it will have a very large guiding role in the opening of the spot market, especially forming a relatively large psychological expectation, or the so-called anchoring effect. In the past, when the market was opened directly, the market maker could first pull a very high price, sell a part of it first, and then add airdrops, etc., and it would naturally fall back at the beginning. But when the price drops to a certain extent, retail investors will think: Wow, it has fallen by 50%, it is already very cheap, after all, this is a project with a future, with the support of W God’s mother and M God’s girlfriend, you can buy it, all in. But after the Pre-market has a low price, even if the project party pulls the price up again, retail investors may have to consider shipping, rather than taking over.
Humans are amazing animals. When the price of something drops from 100 yuan to 80 yuan, you will think it is really cheap, it is a big sale on Double Eleven, a good opportunity that only comes once a year. But when it rises from 60 yuan to 80 yuan, you will think it is too expensive and you should wait a little longer. You know what, this is human nature.
In summary, the launch of Pre-market is another bold attempt by Binance to oppose high market value, aiming to allow the community to set prices before the market opens, thereby eliminating the control of prices by the project side. And through psychology, it can influence the actual spot price after the market opens, so that retail investors who want to participate can participate in advance, rather than being harvested by the project side at the market opening.
The actual situation needs to be verified in practice. But Binance has good intentions, and I hope to achieve the expected results. After all, the market value of the projects listed on the exchange is too high, and the secondary market is almost gone. In this way, good and high-quality projects can be listed with peace of mind in the future. Because of clicking, clicking, clicking, clicking, I have broken two mice.
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