A recent analysis conducted by a prominent crypto and macro researcher, known as "Flow," has brought attention to concerning trends surrounding tokens listed on Binance, the world's leading cryptocurrency exchange.
The examination of the past six months' worth of listings on Binance reveals a troubling pattern: More than 80% of tokens have experienced a decline in value since their initial listing. This discovery prompts serious questions regarding the viability and sustainability of these projects, particularly given the significant valuations they command upon launch.
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While a handful of tokens, such as ORDI, JTO, JUP and WIF, have managed to buck the downward trend, they represent exceptions rather than the norm. Conversely, tokens like NFP, PORTAL, AEVO and others have suffered substantial losses, indicating a prevalent issue of overvaluation followed by rapid depreciation.
Looking at all the new listing of the past 6 months on the largest CEX, Binance, we note that >80% of tokens are down from their listing date.The only exceptions are:- $MEME: A meme coin- $ORDI : No tier 1 VC- $JUP + $JTO: Big Solana momentum- $WIF: Another meme coin pic.twitter.com/Y8VQV6jt6T
— flow (@tradetheflow_) May 17, 2024
Flow's analysis suggests that Binance listings may no longer offer lucrative investment opportunities but rather serve as exit strategies for insiders and venture capitalists.
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In essence, it is widely acknowledged that securing a listing on a major exchange represents a significant milestone for any new token, with investors anticipating a boost to their investment. Similarly, it is no secret that these listings often serve as opportunities for holders to capitalize on token growth and cash out their crypto holdings.
However, the question arises: Is there genuine cause for concern beneath this surface drama, or is this simply an accepted consensus among market participants?