Crypto Market Token Allocation and Price Movement Analysis

Recently, the token allocation of multiple crypto projects shows that the proportion of VC generally ranges from 10% to 30%, which has not changed much compared to the previous period. Most projects choose to distribute tokens to the community through airdrops, but users often tend to sell immediately, causing significant selling pressure. High concentration of token chips is detrimental to the effect of airdrops. From the performance of token prices, projects dominated by VC generally perform poorly, often showing a one-sided downward trend after issuance.

It is worth noting that the SHELL project adopts different strategies, allocating 4% of the Tokens through IDO, with an initial market value of only 20 million USD. In addition, projects like Soon and Pump Fun choose to distribute over 50% of the Tokens through fair launches, combined with a small amount of VC and KOL for large-scale community fundraising. This community-benefiting approach may be more readily accepted, while the project side can signal positively to the market by repurchasing chips through market making.

The End of the Memecoin Bubble and the Collapse of Market Structure

The market has shifted from the VC-led Builder model to a purely "pump" bubble model, causing tokens to fall into a zero-sum game, making it easier for retail investors to incur losses and exit. This has exacerbated the structural collapse of the primary and secondary markets, and rebuilding may take even longer.

The atmosphere in the Memecoin market has plummeted to rock bottom. Retail investors realize that Memecoins are still difficult to escape the manipulation of various forces, losing fairness. Short-term drastic losses affect user expectations, and such issuance strategies may be nearing their end.

Despite the attempt of AI Agent narratives to drive the market, it has not changed the essence of Memecoin. A large number of Web2 developers and Web3 shell projects have flooded in, leading to the emergence of many AI Memecoin projects disguised as "value investments." Community tokens are maliciously manipulated, causing serious negative impacts on the long-term development of the projects.

When Memecoin loses its religious or niche belief cover, market sensitivity decreases. Retail investors still look forward to the opportunity to get rich quickly, seeking high-certainty Tokens, which plays right into the hands of certain forces. Larger bets attract teams from outside the industry, and the liquidity that is drawn away may never return to the crypto market.

The Dilemma of VC Coin and Market Consensus

The strategy from the previous cycle has become ineffective, but due to inertia, many projects still follow the old model. The biggest drawback of VC-driven Tokens is that they cannot gain an early advantage during the token generation event (TGE). Users no longer expect to achieve ideal returns by buying coins, believing that project parties and exchanges hold a large number of Tokens, putting them in an unfair position. At the same time, VC return rates have significantly declined, investment amounts have shrunk, and coupled with users' unwillingness to take over, VC coin issuance faces immense difficulties.

For VC projects or exchanges, direct listing may not be the best choice. Once listed, the contract rate may quickly turn negative. The team and the exchange lack the motivation to pump the price, and shorting new coins has become a consensus in the market.

After the issuance of tokens, there has been a frequent occurrence of unilateral declines, reinforcing market perception and leading to "bad money driving out good money." Even when aware of the risks, retail investors may resort to retaliatory short selling. When the situation of short selling reaches its extreme, project parties and exchanges may be forced to join in to make up for the target returns that cannot be achieved through dumping.

Reluctance to lose control of chips has led to a significant lack of progress in the amount of VC coins during the TGE compared to four years ago. Although there are issues with this approach, both the VCs and the project parties show a numb attitude. The initial project teams may experience survivor bias, believing they can create different value.

Dual-Drive Mode: Breaking the Pricing Dilemma of VC Coin

The pure VC-driven model increases the pricing discrepancies between users and project parties, which is detrimental to early price performance; a completely fair launch is easily manipulated maliciously, resulting in the loss of low-priced chips. Only by combining the two can reasonable resources and planning be obtained in the early stages of the project, avoiding the worst outcomes.

Traditional financing models are failing, and new methods are emerging: projects are advancing by collaborating with leading KOLs and a small number of VCs, using a high proportion of community launches and low market cap cold starts. Projects like Soon and Pump Fun are paving new paths by directly distributing 40%-60% of tokens to the community, launching projects at low valuations. This model builds consensus through KOL influence, locks in profits in advance, and simultaneously exchanges high liquidity for market depth.

The Myshell project demonstrates a groundbreaking attempt by issuing 4% tokens through IDO, with an initial market value of only 20 million USD. Users need to operate through the exchange wallet, and all transactions are recorded directly on the chain, enhancing transparency. This mechanism brings new users to the wallet while providing a fairer opportunity.

The contradiction between the project party and the VC lies in transparency. By launching the Token through IDO, reliance on exchanges is eliminated, which can resolve the transparency conflict for both parties. The on-chain Token unlocking process is more transparent, ensuring that conflicts of interest are effectively addressed. On the other hand, traditional centralized exchanges face the dilemma of price plummeting after the Token issuance, while on-chain data transparency helps to more accurately assess the project's real situation.

The core conflict between users and project parties lies in pricing and fairness. Fair launches or IDOs aim to meet users' expectations for token pricing. The fundamental issue with VC coins is the lack of buying support after listing, with pricing and expectations being the main reasons. The key to breaking the deadlock lies with the project parties and exchanges. Only by benefiting the community in a fair manner and continuously advancing the technical roadmap can project value growth be achieved.