Expert Questions the “Wealth Effect” of Token Purchases on Binance Alpha

7k7t2g4tcro4hnsejmnacrjqce

Out of the 29 tokens added to the Binance Alpha platform, 17 experienced price increases, while 12 saw declines, according to user sankin_eth.

In the dataset, the maximum market capitalization was under $1 billion, while the minimum was slightly over $10 million.

The best-performing tokens were those with the smallest market capitalizations. Five of them achieved triple-digit growth: two from the AI agent category and three from meme tokens.

Of the 12 tokens that incurred losses, nine had market capitalizations above the median average. Sector-wise, there were no significant trader preferences noted.

Tokens issued on the BNB Chain mostly saw price increases, while tokens from other networks showed mixed results.

The study’s author concluded that the platform does not currently create a notable “wealth effect.” However, this could improve after the tokens are listed on the exchange, due to their low Fully Diluted Valuation (FDV).

Binance has stated that some tokens may be considered for listing but has not guaranteed this outcome.

Launched on December 17, Binance Alpha aims to help users explore and invest in early-stage cryptocurrencies.

The pool of selected tokens is curated based on Binance’s industry expertise, advanced analytical insights, community interest, and market trends.

Related Developments

In December, Binance introduced the On-chain Yields financial product service. The first in the lineup was Babylon, a Bitcoin staking project.