OKX founder Star Xu criticizes the frequent sell-offs of newly listed altcoins, highlighting the dramatic 90% decline in the Aevo token’s value over five months.
Points
- Aevo token fell from nearly $4 in March 2024 to $0.434, a 90% decline.
- OKX founder Star Xu raises concerns about the lack of supervision on listing and reducing holdings.
- Aevo team announces a buyback strategy to stabilize the token’s price.
- Token unlock events and VC profits are contributing to market pressures.
- Similar issues are observed with other altcoins facing significant market impact.
The Aevo token has experienced a dramatic decline in value, falling from a high of nearly $4 in March 2024 to a current value of $0.434, representing a 90% drop in just five months. This steep decline has sparked criticism from Star Xu, the founder of major crypto exchange OKX, who raises concerns about the frequent sell-offs of newly listed altcoins and the lack of supervision in the market.
Xu’s criticism extends beyond the market fluctuations to address the ethical responsibilities of crypto exchanges. He questions how the industry can protect the market in the absence of supervision on listing practices and the reduction of holdings by project developers.
In response to the significant price decline, the Aevo team has implemented a token buyback strategy to stabilize the price. In July, they purchased 1 million AEVO tokens at an average price of $0.446. The team announced a commitment to buy back at least 1 million AEVO tokens every month from July to December, aiming to create long-term value for token holders.
Market Pressures
The Aevo token is not alone in facing these challenges. Recent data from the Dune dashboard, VC Printer, indicates that several altcoins are under similar pressures. Venture capitalists （VCs） holding Ethena （ENA） are sitting on an unrealized profit of 73X, posing a significant risk of market impact if these profits are realized.
Token unlocking events further contribute to market pressures. Wormhole’s upcoming release of 600 million W tokens, constituting 33% of its circulating supply, is expected to introduce substantial selling force into the market. Similarly, AltLayer recently unlocked over $100 million worth of ALT tokens, making up around 42% of its supply, which could ignite additional selling pressure if stakeholders sell their tokens.
解説
- Market Supervision: The lack of supervision on listing practices and the reduction of holdings by project developers is a significant concern in the cryptocurrency market. Establishing clear guidelines and regulatory oversight could help protect investors and ensure market stability.
- Token Buybacks: Implementing token buyback strategies can be an effective way to stabilize token prices and create long-term value for holders. By committing to regular buybacks, project teams can demonstrate their confidence in the token’s future and provide support during periods of market volatility.
- VC Influence: The involvement of venture capitalists in the cryptocurrency market can have a profound impact on token prices. Large holdings and significant profits can lead to substantial market movements when VCs decide to realize their gains. Understanding the role of VCs and their potential actions is crucial for market participants.
- Token Unlock Events: Token unlocking events are critical moments that can introduce significant selling pressure into the market. Being aware of these events and their potential impact on supply and demand dynamics is essential for traders and investors.
- Ethical Responsibilities: The ethical responsibilities of crypto exchanges and project developers are paramount in ensuring a fair and transparent market. Addressing these responsibilities through industry standards and regulatory measures can help build trust and protect the interests of all stakeholders.