Question about token's price when a listing takes place

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Quote from: Shastatimer2 on March 04, 2023, 12:57:57 AM

...I hope that my question is clear, and I'd appreciate it, if you could help me better understand the reasons behind the decreasing of the token's price in that situation.

As a rule, the listing of coins on CEX is preceded by a round of pre-sale and it is at this stage that the team receives investors' money for the development of the project. The price of the coin at this stage can be ten times lower than the listing price on CEX. And accordingly, early investors usually fix part of the profit by selling coins purchased at an early stage of sale in order to return their investment in the project. In addition, the team also has coins that they receive for free and, accordingly, can also sell on the listing.

Pierre 2

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This is like a lesson for altcoin investment beginners. Good thread honestly. As OP experienced, sometimes people just dump their initial investment for no appearant reason. Well actually there could be many hidden reasons behind it. For example devs could be one that are dumping it for quick bucks. Some people have bad intentions. Its about chance. Sometimes people just agree that project is nothing but shit so demand stays very low. Price keeps decreasing etc.

hugeblack

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Quote from: Shastatimer2 on March 05, 2023, 09:50:33 PM

- The tokens had never been listed on any exchange (CEX or DEX)
- There was a coming listing on Bitmart, the first time that the token would be tradable :

Circulating supply :
3 700 000 tokens divided into :
Liquidity : 2 500 000 tokens and,
Marketing : 1 200 000 tokens.

These indicators do not look good in general, as the lack of listing on any good platform makes the price very centralized, and therefore high fluctuations without ease in executing orders, especially since they will be listed on unknown platforms that may manipulate prices in order to lose your money.

Also, the number of tokens allocated for marketing, which represents about 1/3 of the tokens, is not a good indicator. Mostly, marketing is after a maximum of 20% and not 33%, and this means that once listed, there will be great liquidity on the part of the developers and on the part of the people who collected the coins in the marketing and promotion.

Shastatimer2

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Okay, thanks.

noorman0

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Quote from: Shastatimer2 on March 05, 2023, 09:50:33 PM

Hi guys,

Thank you very much for your useful explanations.
The project's name is Honeywood, and the listed token's name is CONE

They have 2 private round sales for CONE token. Not only that, some allocations such as marketing, partnerships, and “unlocked” holding allocations, have the potential to be sold as soon as the token is listed.
You can also do a search in the group with the keyword "giveaway", they did it for free for several events in the past.

Shastatimer2

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Hi guys,

Thank you very much for your useful explanations.
The project's name is Honeywood, and the listed token's name is CONE

https://www.bitmart.com/trade/en-US?layout=basic&symbol=CONE_USDT&theme=dark
Tokenomics : https://whitepaper.honeywood.io/en/tokenomics/the-tokenomics-of-cone

When I looked at their tokenomics, here is what I saw :

- The tokens had never been listed on any exchange (CEX or DEX)
- There was a coming listing on Bitmart, the first time that the token would be tradable :

Circulating supply :
3 700 000 tokens divided into :
Liquidity : 2 500 000 tokens and,
Marketing : 1 200 000 tokens.
Listed price : 0.2$

All the other tokens were vested at the time of the listing.
And I read that the team would not sell their tokens, so I assumed that the only tokens that would be sold would be the tokens in the liquidity pool, bought and sold by people who'd buy the token on bitmart.

So I assumed, that if I bought very early, the tokens would have much more chances to go up than down, since I would not understand why first buyers would be likely to sell their tokens below the price of their purchase.
So in the end, it seems that my approahc was incorrect (even if I made money with this listing, I was obviously wrong).

Either because the team either sold part of their tokens for marketing, or because their tokenomics is inacurrate, or because of the law of supply & demand as you guys said.

asriloni

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I think that you shall try to analyze the tokenomic of that project. I guess that project has done private sale before. That being said that the participant of private sale will able to buy below the listing price.

If you can even mentione the name of project and i can help you to find that. You shall aware of the tokenomic. Sometime the project was making tokens to be bought by the early investors at very low price below the listing price.

That being said that once the token got listed with the listing price and the private sale buyers have been making decent money. that's why the price token gets dumped due to the private sale buyers.

You can ask the project owner whether the project has done private sale or not. It's not always related with airdrop.

Yatsan

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Quote from: Shastatimer2 on March 04, 2023, 12:57:57 AM

Hi everyone,

There is something that I don't really understand.
Recently, a listing for a token took place on a CEX, and it had a starting price of 0.2$.

I'm not 100% sure, but I think that there were no tokens airdropped before this listing.
And that all the tokens were vested, so the only way to buy and sell the token was on the CEX where the listing took place.

And what surprises me is that right now, the token has lost around 20 %.
I'd like to precise that this loss of 20% happened when the bitcoin's price remained around 23k and 24k.
So it was before that the bitcoin dropped from 24/25k to 22K.

I'm not sure to understand how it can be that the token lost 20% since the only people who are able to buy and sell the tokens are the ones who have bought it on the CEX.
I hope that my question is clear, and I'd appreciate it, if you could help me better understand the reasons behind the decreasing of the token's price in that situation.

Thanks :

Even before, such instance is not new in this industry. What I saw during 2017 is a sudden dump with the market price of newly listed tokens. I had the same question but as I have realized, investors has a way to have holdings of a particular token; pre-sale and bounty campaigns. Before bounty participants were believed to be the main reason for a dump after token listing because they are more likely ones who would go for instant profit from participating. This possibility is also anticipated by those who bought during pre-sale which somehow forms a domino effect and will only be reversed if a project is just that promising which would give early investors the idea to just hold for a period of time.

I guess same thing happened with what Op have mentioned unless it is an exchanger token wherein investors would only be able to purchase upon its release but if it is a typical project token then for sure they made way to introduce it on its early stage.

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Quote from: Shastatimer2 on March 04, 2023, 12:57:57 AM

I'm not sure to understand how it can be that the token lost 20% since the only people who are able to buy and sell the tokens are the ones who have bought it on the CEX.
I hope that my question is clear, and I'd appreciate it, if you could help me better understand the reasons behind the decreasing of the token's price in that situation.

Thanks :

This is where the real value came from, if that token just got listed and that's the only way to buy that token probably the investors are not that happy about that project and sees the listing price is quiet high that's why many are not buying it at a higher price and they are actually waiting for its real value at the bottom price.

This is normal once the listing commence, many thought it will pump easily but in reality they must experience that drop first before making a huge impact in this market, this is not just about the status of Bitcoin, this is more about the product or services they are going to offer in this market, if investor didn't see any value on that expect a more drop.

Jackl87

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Quote from: Shastatimer2 on March 04, 2023, 12:57:57 AM

Hi everyone,
There is something that I don't really understand.
Recently, a listing for a token took place on a CEX, and it had a starting price of 0.2$.
I'm not 100% sure, but I think that there were no tokens airdropped before this listing.
And that all the tokens were vested, so the only way to buy and sell the token was on the CEX where the listing took place.
And what surprises me is that right now, the token has lost around 20 %.

I think that you have just missed something here and that there definitely were some token unlocked already for certain types of investors or whatever. I mean that CEX also needed to get the tokens from somewhere to even have liquidity for a trading pair so it is impossible that all tokens are still vested. Also if you look at the tokenomics of most new projects, then usually a part of the tokens that private and even seed sale investors are getting are unlocked on the TGE (f.e. 10% or 25% of the total amount of tokens that they will get) and the rest has a vesting and will be slowly unlocked over time. The team behind the token usually has a cliff which means they don't get any tokens at all on the TGE. If that is not the case, then i would not invest into that project.

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Quote from: Shastatimer2 on March 04, 2023, 12:57:57 AM

I'm not sure to understand how it can be that the token lost 20% since the only people who are able to buy and sell the tokens are the ones who have bought it on the CEX.
I hope that my question is clear, and I'd appreciate it, if you could help me better understand the reasons behind the decreasing of the token's price in that situation.

Anything is possible when it comes to new launch tokens and its not sure whether youll gain or loss. In a bear market like now, most launch tokens didnt have a nice performance and thats due to low demand since many people are not interested into buying new tokens that arent a solid hit. Even though the project is good there comes time that we experience a downfall even for just a day.but if you trust the project hold onto it and forget for quite sometime.

Bitcoin_Arena

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Could you please mention the name of the token. It would be easier to analyze what happened.

What I usually know is there are people who get the tokens or coins way earlier than others and as soon as it's listed, they dump it on other people. This happens even with coins or tokens sold on exchange launchpads. There is always a lot of manipulation. Be very careful, or you will lose lots of funds in minutes trying to chase these coins.

tbct_mt2

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Forget about chasing for coins or tokens when they are firstly listed on exchanges especially on Tier 1 exchanges. It is barely to see any dump by listing on Tier 1 exchanges so the opposite and more commonly seen is pumps to the Moon like x2, x5, x10, x20 or more crazy x100.

What usually happen after such Moon pumps?

Those coins or tokens will be dumped to the hell or better, they will have good ups and downs in a first week after listing and if you are experienced, you can get profit with their ups and downs.

Newbies, amateur people will lose a lot in ups and downs and they even hold a few weeks and shake their hands. Other pumps will not come soon because market makers know that they must shake all weak hands out before doing their new game rounds.

hugeblack

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Without giving us details, we will not be able to get a perfect picture of what happened, but who owns a larger percentage of these tokens so that he can sell them off the list? Is the developer team? Or the platform? Or a private investment or what? Distributing coins via a airdrop is a method, but there are several other ways.
Also, the price when listing is a preliminary price, after which supply and demand control the price, and therefore you may find differences greater than 20% if no person wants to buy that token.

Tytanowy Janusz

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Quote from: Shastatimer2 on March 04, 2023, 12:57:57 AM

I'm not 100% sure, but I think that there were no tokens airdropped before this listing.
And that all the tokens were vested, so the only way to buy and sell the token was on the CEX where the listing took place.

From where the initial supply comes from? Who was the selling part of transaction on CEX if all tokens are vested? something is not right here. If there was a transaction, there had to be tokens available for purchase. I guess that the team allocated part of the supply to the listing and these tokens were used as the liquidity on the sales side. How many tokens were for sale and how many have already been sold will be one of factors to determine how low the token will fall. but even after they sell all tokens they allocated for this purpose the price can continue to go down.

"the only people who are able to buy and sell the tokens are the ones who have bought it on the CEX." it doesn't matter because people can sell at a loss. The only reason why price go up is because there are more buyers willing to pay more than sellers willing to sell even at lower price.
If the price does not increase and there is a shortage of buyers, the price starts to fall, because there is no one to sell the tokens to at the current price. In the extreme scenario where the number of new buyers is 0, the price is also 0. It doesn't matter who bought and for how much.

Shastatimer2

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Hi everyone,

There is something that I don't really understand.
Recently, a listing for a token took place on a CEX, and it had a starting price of 0.2$.

I'm not 100% sure, but I think that there were no tokens airdropped before this listing.
And that all the tokens were vested, so the only way to buy and sell the token was on the CEX where the listing took place.

And what surprises me is that right now, the token has lost around 20 %.
I'd like to precise that this loss of 20% happened when the bitcoin's price remained around 23k and 24k.
So it was before that the bitcoin dropped from 24/25k to 22K.

I'm not sure to understand how it can be that the token lost 20% since the only people who are able to buy and sell the tokens are the ones who have bought it on the CEX.
I hope that my question is clear, and I'd appreciate it, if you could help me better understand the reasons behind the decreasing of the token's price in that situation.

Thanks :

Topic: Question about token's price when a listing takes place (Read 136 times)