Is the Binance Listing Effect Weakening Three Key Factors Influencing the Price Surge Market Project Quality and Narrative

CoinWorld.com reported:
Price is not everything for a project, and its development largely depends on market conditions, project quality, and the hype surrounding its narrative.
By Andrew Moh, Crypto KOL
Translated by Felix, PANews
Recently, being listed on mainstream cryptocurrency exchanges, especially Binance, has become a catalyst for projects.
“When Binance?” or “When listing Binance?” have become common phrases in the crypto community. There are two key factors driving this phenomenon:
1. Liquidity
As one of the largest centralized exchanges globally, Binance provides excellent liquidity, ensuring seamless and high-volume trading.
Being listed on Binance can enhance a project’s attractiveness and trading activity.
2. Reputation
Binance’s subsidiary, Binance Labs, sets the industry standard for credibility. When a project receives recognition from Binance Research, it greatly increases user awareness. With Binance’s support, user trust soars.
“If Binance is involved in the investment, the project is sure to be a winner.”
Previously, Arthur Hayes, co-founder of BitMEX, wrote that Binance charges a listing fee of up to 8% of the total token supply and requires projects to purchase and stake BNB, which will be refunded upon delisting. This is equivalent to $5 million (other exchanges require a deposit of $250,000 to $500,000 in stablecoins or their tokens).
Related reading: Arthur Hayes to Crypto Projects: Instead of Struggling to Get Listed on Binance, Just Go DEX
Projects seeking to be listed on Binance or other exchanges must invest a significant amount of capital.
Many TGE projects with high FDV often lead to losses for retail investors.
Meanwhile, venture capital firms profit significantly, selling at prices as high as 142.5%.
VanEck points out that investment funds focus too much on short-term gains, affecting users and projects. Hayes advises caution when prioritizing listing on Binance.
However, projects listed on Binance tend to succeed due to their strong communities and technology. More and more valuable projects are aligning with this trend.
Nevertheless, the high listing fees force projects and VCs to pursue short-term profits, negatively impacting investors’ performance in 2024.
So the question remains: Is listing on Binance always a driving force for price increases?
Price increases will depend on many key factors, not just listing on Binance, including:
1. Market conditions
2. Project quality
3. Hype surrounding the narrative
and more.
1. Market Conditions
Market conditions are the most significant factor directly affecting token prices.
The table below shows that out of the 37 tokens listed on Binance in 2024, all but 5 experienced a “breakdown” status.
NEIRO has risen by 294% since its listing on September 16, with an FDV of approximately $690 million.
Most tokens listed on Binance in 2024 have experienced declines, with over half experiencing a drop of at least 30-80%.
The worst performer is AEVO, which has dropped over 88% since its first listing in February.
So how should we view tokens listed on Binance?
Based on these statistics, you may lose trust in every project listed on Binance. (If you invested in projects listed on Binance in 2024, your current success rate is only 13.5%)
This is normal due to market conditions.
BTC is nearing $70,000 and has risen from $42,000. But why are almost all altcoins still in a downward trend?
2. Project Quality
You might think that Binance Labs is a reputable VC company. Projects seeking listing on Binance are not just financial stories. It also means:
– Good product quality/innovation
– Large community
Binance Labs rigorously reviews each project to ensure that only the best projects are selected.
The seed tag on Binance applies to:
– Tokens in the innovation zone designed to trade new tokens while protecting other tokens from volatility risks
– Innovative tokens with potential future listings
However, Binance always issues announcements related to monitored tags. If a project is listed on Binance but:
– Has high volatility and poor liquidity
– Is a low-market-cap project
– Has delisting risks
– Engages in suspicious operations that jeopardize users
It will be added with a monitored tag.
If this situation continues, these projects will be delisted from Binance. This would be a disaster for the projects and their holders.
3. Hype Surrounding the Narrative
In 2024, Web3 users are discussing “narratives.” From AI and DePIN to RWA, each narrative contains a story that is expected to lead the industry towards mass adoption of cryptocurrencies.
But you can see the market’s reaction to these narratives. Almost all current narratives have their moments, but most are struggling.
From the table above, you can see that 4 out of the 5 projects that have risen are meme projects. Meme seems to be a magical ticket attracting millions of users.
According to CMC data, out of the top 100 meme projects by market capitalization, 11 are meme projects.
7 meme projects have market capitalizations exceeding $1 billion.
It is expected that in the next bull market cycle, at least 3 meme projects will reach a market capitalization of $1 billion.
In conclusion, being listed on Binance seems to be the dream of every Web3 project, but it is not just a matter of price. Projects listed on Binance may undergo careful scrutiny from top VCs.
However, the development status of a project cannot be guaranteed. It is time to reconsider investment strategies if users only invest in projects listed on Binance. Price narratives are not everything, so wise investments are advised to ensure a clear mind.