The rapid update and iteration of the blockchain industry is not only reflected in technological development, but also in financing methods. ICO was cool, and STO appeared, and now, the limelight of STO has not completely dissipated, and the heat wave of IEO has hit.
The rapid update and iteration of the blockchain industry is not only reflected in technological development, but also in financing methods. ICO was cool, and STO appeared, and now, the limelight of STO has not completely dissipated, and the heat wave of IEO has hit.
At 10:00 p.m. on the 19th, the IEO of CELR on Binance Launchpad was sold out in just 17 minutes and 35 seconds. The state and probability of users grabbing shares is no less than grabbing train tickets for the Spring Festival. This popular phenomenon goes back to the beginning of this year when Binance restarted the asset issuance platform Launchpad. The popularity of BTT, the first project after the restart, not only aroused the enthusiasm and confidence of investors, but also made colleagues unable to hold back. Binance founder Zhao Changpeng said in an interview with the media, “The core of the IEO model is to find good projects, and other exchanges are welcome to copy.”
The exchanges are "ready to move" and rushed to this new "feast". Huobi has announced that it will launch Huobi Prime in late March. The official claims that this is a comprehensive currency listing service platform around HT. OKEx CEO JayHao also announced that the OKEX utility token sales platform "OK Jumpstart" is ready from technology to products and can be launched at any time. There is also news that Kucoin, Bittrex, and ZBG will soon launch similar platforms. But Bittrex hastily canceled the first IEO event within hours of launch.
The full name of IEO is Initial Exchange Offering (Initial Exchange Offering), which refers to the fundraising behavior in which the issuing team skips the ICO link that needs to raise funds from the public and directly puts tokens on the exchange for trading. Some people believe that IEO can help project parties raise funds, help exchanges make profits and become famous, and protect investors from fraud. Changpeng Zhao also admitted to the media that the current financing model is not only about financing money, but also "financing users", "financing popularity" and "financing reputation". Is the status quo rich and famous? How about the performance of project tokens issued through the above platforms?
The endorsement of the exchange still breaks the currency and does not mean that there is liquidity
At present, only Binance’s Launchpad platform has launched 4 projects (CELR, which was launched at 10:00 p.m. on the 19th, has not yet been included in the statistics). The projects on other platforms have not been launched and open for purchase. Among the four known IEO projects, GTO and BRD launched at the end of December 2017 do not need to use BNB to purchase, while BTT and FET newly launched this year do.
From the statistical results, it is interesting that BTT, which closed down on the first day of launch, is the only one among the four projects that has not broken the price so far, and has performed the most steadily. The current market value has exceeded 130 million US dollars, ranking 46th in market value. On the other hand, FET, which also uses BNB to purchase, only rose slightly by 0.8% on the first day, but it has broken in two weeks since its launch. The current market value has not yet been included by CoinMarketCap, and only shows the ranking of 1789. On the other hand, GTO and BRD, which went online earlier, both ushered in big gains on the first day, with an increase of nearly 20%, but they have broken so far. At present, the market value of GTO ranks 171, and the market value of BRD ranks 154.
In the final analysis, it is the project itself that determines the value of the token, and it has little to do with which exchange it is listed on and how it obtains financing. Good projects will naturally gain market recognition, land on other exchanges, and open more trading pairs. According to PAData statistics, at present, BTT, which has only been online for one and a half months, is the most liquid token among the four projects, and has landed on 29 exchanges with a total of 14 trading pairs. The second is GTO, which has been online for more than a year. It has landed on 16 exchanges and established 9 trading pairs. FET currently only lands on 5 exchanges and establishes 4 trading pairs. BRD is the least liquid among the 4 projects, and it only lands on one exchange, with a total of 3 trading pairs.
The liquidity of the 4 project tokens can also be seen from the degree of dependence on the Binance exchange. BRD, which has the worst liquidity, is the only exchange that has landed on Binance, and the second FET has landed on 5 exchanges. , but 93% of its trading volume occurs in Binance, and the other four exchanges only contribute 7%. BTT and GTO are much less dependent on Binance, especially BTT, which has only been online for a month. Although it was successfully listed on Binance’s Launchpad platform, its trading volume on Binance only accounted for 32% of the total trading volume. %, which means that BTT is also very active in other exchanges and is recognized by the market.
It can be seen that whether to use BNB to purchase project tokens has no effect on the circulation of project tokens. In other words, although Binance is a leading exchange, the effectiveness of Binance’s endorsement is not the entire cryptocurrency market. To be recognized by the market, it still depends on the strength of the project itself.
In addition, the project tokens purchased through BNB can have more trading volume in Binance. The transaction volume of BTT has accounted for 6.48% of Binance, and the transaction volume of FET has accounted for 1.24%. However, early projects that did not use BNB to purchase Both BRD and GTO account for less than 1% of Binance’s trading volume. From the perspective of trading pairs, BTT/BNB has already accounted for 0.42% of Binance’s total trading volume, which is the third largest BNB trading pair after USDT and BTC. Although FET/BNB only accounts for 0.07%, it is also It is already the eighth largest BNB trading pair.
In this sense, Launchpad has a guiding role in activating BNB transactions. Insufficient liquidity and a break may reduce the profit of the project party and allow investors to bear losses, but for the exchange, it not only bears the smallest risk, but also draws commissions and activates the platform currency, which is just a good deal.
He Yi, the co-founder of Binance, posted on Weibo on March 17, saying, “Recently a popular word is called IEO. To be honest, I don’t even know what E is? Which word is this shorthand for? Draw a key point for everyone: the project The reason why they are popular is that the project quality and price are lower than the private placement price. Once launched, all project prices are determined by the market. The market is a global market, and the quality of the project is left to time."
The win-win situation has not yet appeared, and the long-term positive platform currency
Through IEO, the project can raise funds, and the exchange can activate the platform currency, which seems to be a win-win situation. But trading is a dynamic process, and listing is not the end, but the starting point, so in this dynamic process, can both parties work together to win-win?
PAData crawled the transaction data on CoinMarketCap. After analysis, it was found that in terms of amplitude, only GTO and BRD, two project coins issued on Launchpad earlier, had obvious resonance with the mainstream currency BTC, and GTO, BRD and BTC The currency price correlation of BTC is very significant, which means that the market trends of the two are more consistent with BTC.
However, the newly issued project coins BTT and FET on Launchpad by using BNB have nothing to do with the mainstream currency BTC and the platform currency BNB in terms of vibration direction, and even BTT has nothing to do with BTC and BNB in terms of currency price fluctuations, which means BTT is more likely than the other three Launchpad project currencies to go out of the independent market in the future, and FET has a negative correlation with BTC and BNB in terms of currency prices, which means that its currency price rise and fall trend is opposite to that of BTC and BNB in many cases , and the ups and downs are irrelevant
Judging from the correlation between currency price and single-day amplitude, whether to use BNB to list currency will not bind BNB and project currency, that is, the two have not yet formed a dynamic win-win situation in the transaction process. Anyway, there is a weak resonance movement in the same direction between BRD and GTO issued earlier and BNB, but this cannot be considered to be directly related to BNB, because the resonance movement in the same direction between BRD, GTO and BTC is more obvious.
In addition, the highest correlation with the BNB currency price is HT, which is also a platform currency, and the amplitude between the two also shows a weak correlation, which means that if BNB rises, then HT may rise far more than through The project currency issued by Launchpad, but BNB skyrockets, HT does not necessarily skyrocket. This shows that before the bundling of BNB and Launchpad project currency has not yet formed a win-win situation, the influence between platform currencies is more significant.
Although the project currency issued by BNB and Launchpad has not formed a win-win situation, even in the short term, BNB will face a round of greater selling pressure after the project is issued. According to Binance’s announcement, less than 10% of investors have grabbed the crowdfunding shares of these two projects. Those investors who have not subscribed may sell their BNB after the subscription period is over, resulting in greater fluctuations in the BNB currency price than usual. For example, after the purchase of BTT ended on February 3, the single-day fluctuation of BNB reached 13.65% on February 5, and 14.30% on February 6. After the purchase of FET ended on March 2, the single-day fluctuation of BNB reached 20.14% on March 5, and on March 6, the single-day fluctuation of BNB reached 11.06%. At present, the single-day amplitude variance since the issuance of BNB has reached 0.02, which is higher than that of BTC and the Launchpad project currency. As a purchase intermediary, BNB is not stable, which is undoubtedly an extra layer of risk for investors.
But in the long run, after the Launchpad project was launched, the frequency of violent fluctuations in BNB decreased. Since launching Launchpad in February, the probability of BNB’s single-day fluctuation exceeding 10% is about 20%, that is, only 2 out of 10 days may fluctuate violently. We must know that before this, this probability was about 40%, that is to say, in the past, BNB may fluctuate violently on 4 days out of 10.
It should be said that the Launchpad project has added a new function to BNB, that is, as a trading medium. The new function means that BNB has a new value, which has positive significance for the stability and even rise of BNB price. It is obvious that IEO is beneficial to the exchange.
