Recent findings from Animoca Research shed light on a rather disheartening trend in the cryptocurrency market. From January to September 2023, a substantial number of tokens listed across five major exchanges—Binance, Bitget, Bybit, KuCoin, and OKX—suffered considerable losses, with median performance plummeting between 40% and 70%. This analysis covered a total of 773 token listings, revealing an increasingly cautious approach by some exchanges amidst a challenging market environment.
Examining the listing strategies of these exchanges reveals a stark contrast in their approaches. Binance and OKX took the most reserved stance, with 44 and 47 tokens listed, respectively. This conservative methodology led to their exchanges exhibiting less volatility, although their rewards for investors remained elusive. Conversely, Bitget showed a much more aggressive listing strategy, introducing an impressive 339 tokens by the end of September. Bybit and KuCoin found themselves in the middle, listing 155 and 188 tokens respectively, indicating a moderate appetite for risk.
The months of March and April emerged as pivotal periods for token listings, where favorable market conditions seemed to spur activity. However, the aftermath of this surge did not align with optimistic expectations, as average price returns dipped significantly across the board.
Despite its aggressive listing stance, Bitget did not emerge as the worst performer overall. Tokens listed on this platform reported an average price return of -46.5% and a median return of -65.9%. Bybit, however, bore the brunt of the negative performance, posting the direst figures with an average return of -50.2% and a staggering median return decline of -70.4%. KuCoin was not far behind with comparable figures, reflecting a bleak outlook for tokens that had been eagerly anticipated by investors.
In contrast, OKX listings displayed a better resilience in this turbulent market, suffering average losses of -27.3% and median declines of -40.6%. Among these exchanges, Binance recorded slightly less disastrous results, with a median performance nearing -50% but still showing a better average performance than OKX at -27%.
Intriguingly, despite the overarching trend of losses, there were pockets of success. OKX boasted the highest proportion of profitable listings, reporting that 27.6% of its 47 tokens yielded positive returns. However, their average and median returns were modest, reflecting a marketplace still struggling to find its footing. In stark contrast, Binance’s seven positive listings averaged an impressive profit of 108.4%, and their median profit displayed a robust 53.5%, indicating that quality may have triumphed over quantity for this exchange.
Bitget and Bybit also showcased average profits over the 100% threshold, emphasizing that despite widespread losses, certain tokens were capable of outperforming others significantly. KuCoin’s performance revealed that 25 of its tokens yielded an average return of 77.8%, underscoring the potential for profitable investments even in an overall downward trend.
As the data showcases both the risks and rewards inherent in cryptocurrency investments, it serves as a reminder to potential investors about the importance of thorough analysis and caution. While certain exchanges managed to pivot performance in favorable directions, overall, the dismal performance of a considerable number of tokens underscores the volatility and unpredictability prevalent in this asset class. Investors must proceed with an astute understanding of market dynamics and a willingness to adjust their strategies in response to ongoing trends.
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