Today we will talk about the logic behind the rise of platform tokens and the mechanism of price manipulation. For a token to rise, it must possess a certain amount of coins and USDT (Tether). As the largest holder of these tokens, exchanges usually do not lack USDT.

So, what is the essential logic behind the rise of platform tokens? It is actually to attract users. Just like opening a shopping mall, to attract customers, you might issue parking discount coupons or vouchers as promotional activities. Price manipulation is like a form of advertising that can amplify the market's momentum.

First of all, as I mentioned, exchanges themselves are the largest holders of platform tokens, and one notable characteristic of platform tokens is that they typically do not circulate on-chain. Whether it is the BGB before the merger or tokens like Dog Head and MX, their on-chain holdings are relatively low, with the vast majority of coins stored in exchanges. Since exchanges are centrally controlled, the amount of funds required for price manipulation is further reduced, making platform tokens generally easier to pump (I know some may mention MNT, which is different).

After communicating with a market maker, I learned that to successfully manipulate prices, the holding ratio must be above 70%. In other words, 70% of the chips must be in your hands; otherwise, price manipulation will be very difficult. The ideal holding ratio is best between 80% and 90%, the higher the better. MNT previously had too many private placements and institutional investors involved, and although it completed all unlocks in July this year, I found that the number of MNT held by the exchange was less than 60, making such a holding ratio very difficult to pump.

Therefore, if you want to invest in platform tokens, it is advisable to pay attention to the number of on-chain holders and the concentration of chips. If there are few on-chain holders, it indicates a higher holding ratio for the platform, and such platform tokens usually have the potential to rise. Of course, you can also choose to dollar-cost average into platform tokens at low prices or during a bear market, as the appreciation of platform tokens typically outpaces that of Bitcoin and has a higher degree of certainty. As long as the platform does not run away or shut down, platform tokens are unlikely to encounter problems. $BNB