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The latest report from Animoca Brands Research analyzes the performance of new cryptocurrencies introduced on exchanges from January to September 2024.
Within it, the most frequent seasonal patterns or trends in the quoting activity on the crypto market are identified.
The study takes into consideration only the coins listed on the exchanges Binance, Okx, Bitget, Bybit, and Kucoin. The results are very interesting and offer us a point of reflection on the altcoin sector.
Summary
Animoca Brands report: negative debut of new tokens on centralized exchanges
According to the latest report by Animica Brands, the new coins listed on centralized exchanges have recorded generally negative performances.
In total from January to September 2024, 773 new cryptocurrencies have been listed on the top CEX such asBinance, Bybit, Bitget, Okx and Kucoin.
Bitget appears as the platform with the most listing activities with 339 tokens, followed by Kucoin with 188 and Bybit with 155.
Binance and Okx have been much more selective compared to their bull and bear exchange competitors.
In 2024, the most profitable time of the year for the introduction of new speculative products was Q1, in the midst of the Bitcoin bull market.
Consider that in the first 3 months of 2024 the exchanges hosted the entry of 37% of the new coins. Despite this, April was the most profitable month, with as many as 133 listings.
Animoca Brands highlights the particularly disappointing performance of these tokens.
On all exchanges, the average ROI among all coins fluctuates between -27% and -50%.
Obviously, there are cases of super positive performance, but also cases of coins that have lost much more than half of their initial value.
More in detail, on Binance 7 tokens experienced an average growth of 108% in the given period, while 37 lost 52.7%.
On Bitget, of the 339 tokens introduced, only 40 have increased in price while 299 have lost an average of 66%.
Bybit appears as the exchange with the highest positive median, but also the one with the highest average negative return set at -70%.
Same fate for Kucoin, which despite its nickname as a platform for gem hunting, has had 163 disastrous listings.
Okx seems to be the best exchange in this ranking based on proportions, despite recording the lowest average price increase at 39.5%.
Source: https://docsend.com/view/gze65pfvim3phadr
The number of new cryptocurrencies is increasing: excessive fragmentation leads to the failure of altcoins
According to Animoca Brands, one of the issues that has most led to the depreciation of new coins listed on exchanges concerns their excessive fragmentation.
At this moment there are over 2.4 million cryptocurrencies, with centralized exchanges periodically eliminating the old glories in favor of the newcomers.
Many tokens are presented as capable of revolutionizing the world but end up being subject to violent speculation and strong inflation.
The wide range of choices available to users makes it increasingly complex for them to navigate through the numerous investment options offered by the exchanges.
The ultimate scenario is that of a market so large where liquidity arrives in a fragmented manner on altcoins, without any more conditions of sectoral rotation.
In fact, until 2021, entire categories of tokens moved together at the same pace, but now we only notice isolated cases of positive performance.
Liquidity is concentrating in large-cap assets, while alts struggle to find momentum. Capital is risk-off.
— Benny (@bennythequant) October 28, 2024
To the fragmentation is added the choice of crypto teams to list coins with low circulating supply and high FDV, in order to easily reward investors and insiders.
A few years ago this strategy rewarded the initial price growth (given the low mcap) but today it no longer seems to work.
FDV isn't a meme.
— The DeFi Investor 🔎 (@TheDeFinvestor) May 17, 2024
Most low float high FDV coins that recently went live are down bad from their listing price.
Be careful with what tokens you buy.
h/t: @tradetheflow_ pic.twitter.com/iuL7qaqH4t
It should also be considered that from January to September 2024 the dominance of Bitcoin increased by 6%, going from 51.5% to 57.5%.
In reality, the bull phase of the BTC-DOM has been continuing undisturbed since December 2022, with the bear market having completely emptied the alternative coins.
This situation has contributed to the formation of a trend where the altcoin have been less appealing compared to BTC, and therefore discarded by the smarter investors.
The relationship between MC and FDV: Animoca brands examines listing trends
Another interesting point from the Animoca Brands report concerns the relationship between MC and FDV of the new tokens listed on the exchanges.
This metric, which identifies the circulating capitalization of a new coin with its overall valuation, helps to understand the trends of the sector.
It is evident, for example, that on Binance the majority of valuable listings have occurred within the 0.4-0.6 range, especially thanks to BANANA, TON, and XAI.
On Okx we notice a strong concentration of listings in the ranges 0-0.2 and 0.6-0.8 where we see the presence of assets like ZK, JUP, ONDO, ZRO, and STRK.
Bybit, Bitget, and Kucoin present lower FDV compared to the first 2 exchanges, highlighting the different selection strategies.
Binance and Okx are more focused on the introduction of already established altcoins with high FDV, despite the reduced growth potential.
Source: https://docsend.com/view/gze65pfvim3phadr
Very curious to note also how, according to Animoca Brands, few listings have occurred with the MC/FDV ratio equal to 1.
By now only the memecoin are presented with their circulating capitalization that coincides with the fully diluted valuation.
This condition usually helps to perceive that type of asset as a scarce good, being exempt from inflation and from the increase in supply.
Interesting to also observe how the highest valuations were reached in the middle level of the MC/FDV ratio.
This suggests that the best choice sometimes lies in a balanced listing approach on cryptocurrency exchanges. Users seem attracted to those coins that have already demonstrated their strength but still imply growth opportunities.