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Lack of Liquidity Causes Delay in Token Issuance Plans

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It is reported that although the prices of BTC and ETH have risen, some projects are delaying their token issuance plans due to lack of liquidity. According to…

Lack of Liquidity Causes Delay in Token Issuance Plans

It is reported that although the prices of BTC and ETH have risen, some projects are delaying their token issuance plans due to lack of liquidity. According to the data of CoinMarketCap, the number of new currency applications decreased throughout 2022, from 10264 in the first quarter to 6350 in the fourth quarter. With the collapse of the cryptocurrency exchange FTX and Alameda Research, this decline accelerated at the end of the year. Before bankruptcy, Alameda was one of the largest market makers, providing billions of dollars of liquidity for large and small tokens. So far this number is only 3000 applications.

Research: As the influence of Alameda continues to exist, more and more encryption startups delay the token issuance plan

Interpretation of the news:


The rise in the prices of BTC and ETH has been a topic of discussion among crypto enthusiasts for quite some time now. However, this news comes with a downside that the lack of liquidity is causing delays in some projects’ token issuance plans. This is a concerning issue that requires an explanation in-depth.

According to CoinMarketCap’s data, the number of new currency applications has decreased from 10264 in the first quarter to 6350 in the fourth quarter of 2022. The decline has accelerated at the year-end due to the collapse of crypto exchanges FTX and Alameda Research. Before Alameda’s bankruptcy, it was one of the largest market makers, providing billions of dollars of liquidity for large and small tokens. This sudden loss of liquidity has taken a toll on the cryptocurrency market.

The limitation in liquidity is a significant hurdle facing the digital economy. Liquidity is vital because it provides investors with the ability to buy or sell assets at any given time without affecting the asset’s price. Without adequate liquidity, investors can face long waits to trade their investments, which can result in missed gains or losses. This delay can have a significant impact on a project’s sustainability and can lead to the project’s failure in some cases.

Due to this lack of liquidity, some projects are delaying their token issuance plans to prevent any adverse consequences. Investors’ fear is that when projects don’t have enough liquidity, they cannot support their tokens, which can lead to price volatility, poor performance, and ultimately, failure. Therefore, companies will have to reevaluate their token issuance plans and structure them in such a way that ensures sufficient liquidity support for the investors.

In conclusion, although the prices of BTC and ETH have risen, the lack of liquidity is causing delays in some projects’ token issuance plans. This inadequacy is due to the declining number of new currency applications and the collapse of cryptocurrency exchanges. It is essential to address the issue of liquidity to maintain the sustainability of the digital economy. Projects must structure their token issuance plans in such a way that they provide sufficient support for liquidity to ensure a secure investment climate for investors.

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