Over the past six months, 80% of tokens newly listed on Binance have depreciated in value compared to their initial trading day on the exchange, according to researcher flow.
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
Exceptions include meme coins Dogwifhat (WIF) and Memecoin (MEME), Solana protocol coins Jito (JTO) and Jupiter (JUP), as well as Ordi (ORDI).
“Most of Binance’s new listings are tokens backed by top-tier venture capital and launched at exorbitant prices,” the expert noted.
The average undiluted market capitalization of assets at the start of trading is approximately $4.2 billion, with a peak valuation reaching $11.7 billion.
Often, these projects “lack real users or a strong community.”
Flow highlighted that a portfolio composed of such coins would have lost about 18% over the specified six months.
“So yes, most tokens launched on Binance are not investment tools—their growth potential is already lost. Instead, they represent exit liquidity for insiders who benefit from retail traders’ lack of access to quality early investment opportunities,” the researcher concluded.
He stated that the current approach to token launches is “unsustainable and discredits the crypto industry.” The expert added that people are tired of being a source of liquidity and are beginning to “see through this nonsense.”
“The game must change. Otherwise, our industry will have to pay for the long-term consequences of these abuses,” flow declared.
On May 16, Binance listed the token NOT from the Web3 gaming project Notcoin, which fell by approximately 65% after trading began.