Author: @BlazingKevin_, Researcher at BlockBooster

CEXs are facing a paradigm shift in user confidence post-listing of new tokens. While one or two projects may defy the trend, most cannot escape the gravitational pull of one-way downward trajectories. If this consensus continues to strengthen, gradually evolving from a 2-3 month phenomenon into a full bull-bear cycle collective belief, CEX user retention rates and growth velocity could suffer severe blows.

The core contradiction lies in the divergence between user and project team pricing expectations. Project teams need to recover early-stage costs from retail investors while high FDV at launch has become standard due to large VC lockups. These two factors inevitably push TGE prices beyond retail psychological thresholds.

The high FDV/low MC strategy was acceptable in previous cycles as the "Buy and Hold" consensus ultimately rewarded diamond hands. However, this consensus began weakening post-BTC ETF approval and was completely shattered by last year's memecoin frenzy. BTC's deep integration with US equities as a dollar reserve asset has decoupled it from four-year cycles first. The triple assault of animal coins, AI Agent coins, and celebrity tokens propelled memecoins to divine status before crashing spectacularly, leaving retail investors unable to adapt to VC coin market-making cycles. Despite seismic market changes, VC coins remain oblivious on their inertial death train. The death spiral stems from three factors:

• Massive VC and team token lockups force minimal early liquidity. Exorbitant FDV causes extreme discomfort for retail investors accustomed to memecoin valuation models.
• Despite limited circulating supply, projects still hoard tokens through opaque airdrop and ecosystem incentive clawbacks. Poor airdrop ROI creates pre-listing FUD in communities.
• Locked team allocations force cost recovery through dumping limited circulating supply, necessitating high-opening prices regardless of market sentiment.

The death spiral's essence is the collapse of long-termism - the complete disintegration of "Buy and Hold" consensus for altcoins. Once prices break key support levels, the fall becomes precipitous. New listings lack technical support, leaving psychological support dependent on project valuation/pricing expectations. For projects realistically valued at $10M, listing at $1B FDV inevitably leads to funding rates hitting -2% at launch. No miracles occur until reality aligns with expectations - and poor price action often overshoots even reasonable valuations. As such projects proliferate, shorting VC coins at launch could maintain >50% win rates despite occasional reflexive exceptions. When long-termism dies while short-termism creates regulatory vacuum chaos, the bubble bursts leaving empty venues.

Compared to traditional industries, crypto remains embryonic. Yet industry pessimism already resembles Ragnarök because short-termism erodes faith/value while accelerating sector vitality depletion. Thus, we must recommit to long-termism starting now.

Myshell's Struggle in Implementing Long-Term Pricing Strategies

Returning to the opening thesis: when VC coins falter, CEXs suffer most. Binance initiated self-rescue through experiments with Myshell - regardless of outcome, this signals top exchanges embracing change. The experiment maintained momentum until February 27th before nosediving post-Binance listing. Below we analyze key timelines and market sentiment from the February 12th airdrop snapshot to post-listing developments.

Two Market Sentiment Reversals

Myshell's market sentiment pre-Binance listing progressed through three phases: airdrop, IDO, and exchange listing - each triggering violent retail sentiment swings. Initially, post-snapshot complaints about low airdrop allocations (30% community incentives with opaque distribution details) created bearishness.

The IDO phase reversed sentiment. By allocating 4% supply to Binance Wallet users at $20M FDV, achieving 100x oversubscription, Myshell addressed the core pricing conflict. However, persistent airdrop distrust led >50% of airdrop addresses to sell at TGE (evidenced by expanding holder counts).

TGE day saw $SHELL peak at $1.64 (320M volume, $420M MC) in first hour on BSC DEXs, then crash to $0.9 ($170M volume, $240M MC) in second hour. Closing at $0.37 ($100M MC) on the 13th, it fluctuated between $0.36-$0.6 ($100M-$160M MC) until the 27th. Accumulation by large wallets increased token concentration during this period.

Overhyped Expectations Breed Front-Running

Pre-Binance listing, Myshell enjoyed positive sentiment as "BSC's AI flagship" with exchange investment and secondary listing expectations. However, chain listing at depressed prices created perfect front-running conditions. Rat warehouse collusion with market makers triggered post-listing unilateral declines, nullifying IDO concessions.

This exemplifies the growing pains VC coins face when pursuing value realignment through product-driven long-termism. Crypto's endemic front-running problem, turbocharged by short-termism, now runs rampant. Strongly anticipated projects inevitably crash upon expectation realization - whether listing high or low.

Balancing Roadmap and Expectations: Myshell's Current Challenge

Low-opening user incentives and community launches are fundamentally sound but require careful equilibrium between expectations and roadmap delivery. Projects should manage token prices between maximum reasonable expectations and minimum product value floors.

Long-termism requires more than IDO concessions. Future efforts must address project-VC transparency conflicts. Chain-based token unlocks enhance transparency and resolve historical conflicts. Traditional CEXs suffer from post-listing price collapses and declining volumes - issues mitigated by on-chain data transparency enabling accurate project evaluation.

Chain-listed projects must prepare for extended CEX listing delays to avoid Myshell's front-running trap. Only by earning user trust on-chain can projects initiate virtuous price spirals.

Kaito's Middle Path Bridges Industry Transition

Kaito's airdrop followed VC coin "best practices": reducing whale allocations while expanding eligible addresses through long-tail distribution. While 96M $KAITO went to ecosystem partners/yappers with undisclosed ratios, the strategy successfully slowed sell pressure through dispersed allocations. Pricing at the psychologically critical $1B FDV level enabled stable floating supply turnover.

Split-Share Mechanism as Flywheel Foundation

Kaito designed an early-stage virtuous spiral integrating NFTs, Yaps, and sKAITO. The split-share mechanism constrains token prices when necessary. Pre-snapshot, Kaito NFTs peaked at 11 ETH (~$30k), then crashed to 0.58 ETH (~$5.8k) at TGE before recovering to 2.5 ETH. Each NFT airdropped 2,620 $KAITO (~$4.7k at $1.8).

sKAITO staking rewards correlate with stake amount/duration and voting activity, inversely relating to Yapper/NFT holder voting power.

Voting power derives from Yappers (50%) and Holders [sKAITO/NFT] (50%). Currently:

• 1 Genesis NFT ≈45,980 votes
• 1 sKAITO ≈11.79 votes
• NFT voting power ≈3,935 $KAITO equivalence
• Dynamic voting power shifts based on NFT/sKAITO market cap dominance

Calculations show NFTs provide cheaper voting power. The arbitrage space between NFTs, Yaps, and sKAITO enables price regulation through NFT market cap adjustments.

Choosing Growth Strategies Suited to Sector Positioning

Kaito's pricing strategy represents a prudent middle path. Returning to long-termism requires grueling product-driven value realization. Kaito's approach involves sustained value output enabling gradual MC-product alignment.

Post-memecoin collapse, Kaito shows potential to become the new attention distribution hub through Mindshare dominance - mediated by KOLs earning yaps. As Mindshare gains importance, more projects will join Kaito's ecosystem, creating a flywheel effect. Success depends on Mindshare market penetration.

Measuring Mindshare adoption remains challenging. Thus, Kaito developed Yapper Launchpad - both a consumer product and B2B metric. Rising NFT valuations and sKAITO staking rates indicate growing market share, attracting more KOLs through expanding yap rewards.

Conclusion

Whether pioneering change like Myshell, adopting community-VC hybrid models, or pursuing Kaito's sector-specific long-term value creation, these innovations signal crypto's maturation towards sustainable growth.

Returning to long-termism resembles austerity adoption in an unregulated industry - doubly difficult given crypto's track record: while DeFi shows promise, NFT/GameFi/Metaverse implementations have delivered poor user experiences. With the wolf of long-termism's historical failures behind and the tiger of short-termist rug pulls ahead, recommitting to long-termism remains crypto's only viable path - though antithetical to human nature. Those distrusting all narratives and technologies may find no growth here.

We must wait patiently for crypto's qualitative leap - whether through AI Agents or other sectors. Until then, we must endure the pain of lancing long-festering wounds while steadfastly maintaining long-term conviction.

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