Author: Luke, Mars Finance
What is Binance Alpha?
As one of the world's largest cryptocurrency trading platforms, Binance has always been at the forefront of the market, constantly adjusting its strategies to adapt to the rapidly changing industry environment. Recently, Binance has launched Binance Alpha, a brand-new listing mechanism that is undoubtedly a profound insight and response to the current state of the crypto market. Its main purpose is to screen and promote potential tokens that have not yet been widely circulated, providing these projects with a stage, while also offering more investment opportunities to platform users.
Binance Alpha is essentially an innovative mechanism proposed by Binance to address the concerns about token listings. Unlike its traditional listing process, the Alpha market allows users to "vote" and trade on new tokens in a more open and speculative manner. This not only enhances the liquidity of the Binance platform itself, but also attracts more investors to participate in the price discovery process of the tokens through a "crowdfunding-like" approach. Each period, Binance will introduce several potential token projects for users to participate in trading, and the growth in trading volume is directly related to the price fluctuations of the tokens - the platform uses trading volume to screen the most promising projects and promote them to the mainstream market.
This mechanism has a very high level of participation, just like a large racetrack, where users are like bettors, betting on Binance Alpha to guess which tokens will become the stars of the future. This "speculative and betting" style of operation immediately attracted a large number of active users to the platform, especially in the context of a sluggish market, this method has led to a surge in trading volume in the short term.
Alpha? Drama!
Today at noon, Binance Alpha hosted a Space called "Binance Wallet Rebirth - A Grand Review for All". He Yi introduced the future innovative plans, and mentioned in the Space that they will establish a Telegram group related to Binance Alpha, so that community members can timely report potential "Rug Pull" projects. This move is obviously intended to bring more community interaction and transparency to the Binance Wallet. However, the host immediately responded: "In fact, this group already exists." Shortly after, the Official Twitter of Binance posted a group link in the comments, which seems to be the "official platform" related to Binance Alpha.
At this time, thousands of investors quickly flooded into the group chat, but who could have thought that this simple link would turn into a "Waterloo" in the next few minutes. Within this Telegram group, the official announced the first batch of projects to be launched on Binance Alpha, which were: $MONKY, $HAPPY, $RIF, $ZRC, $ELIZA.
As soon as the information was released, the market reacted quickly and violently: the token prices of these 5 projects soared, especially ELIZA, which skyrocketed several times within a few minutes. This seemingly windfall opportunity quickly attracted a large number of short-term speculators, and almost everyone felt they had grasped an excellent trading opportunity.
The holders of the mentioned projects cheered, "Great, it's Binance, we're saved," but at this time, Binance officially issued a clarification statement, stating that the Telegram group was not an official release. At this point, the once-soaring coin prices quickly suffered a heavy blow, and the prices of all projects began to plummet rapidly, especially ELIZA, which plummeted from its previous high. The original "lucky investors" began to suffer losses, and the market sentiment quickly changed from excitement to panic. Investors' confidence collapsed rapidly, and Binance obviously became the fuse of this chaos.
At this point, the truth of the incident surfaced. Binance officials stated that the Telegram group link that was mistakenly released was indeed officially released by the Binance Wallet, but it was accidentally sent out wrong. A new Telegram group link was then provided, which was quickly discussed by investors and became a new "petition base".
In this group, users expressed their dissatisfaction and anger at the official's operations, accusing the Binance Wallet of being hasty and irresponsible. Some even described the incident as a "sloppy team" and criticized the Binance team's capabilities without mercy.
A launch event that should have been a market highlight turned into a public relations disaster about trust and transparency within a few hours, and Binance Wallet and Binance Alpha have been questioned as a result.
There are many victims of this blunder, but the funniest one is this:
This unlucky guy sold 1.76 million $arc (about $170,000) after the news release, and bought 1.42 million $ELIZA at a cost of $0.1376. Later, he realized that ai16z eliza was the lowercase $eliza, and he sold all the tokens at $0.09567, losing $59,600. Finally, after the official announcement of the blunder, $eliza also plummeted, and he had to sell at a loss of $43,000 (cost price $0.01693, selling price $0.01157), with a total loss of 52.5%.
Although this "official mistake" drama ended with a simple explanation of "the link was sent out wrong," its impact is far from over. With the launch of Binance Alpha, the "wolf is coming" effect seems to be continuing.
The First Batch of Binance Alpha Projects Have Varying Gains
The first batch of Binance Alpha projects are: KOMA, Cheems, APX, ai16z, AIXBT.
KOMA
Koma Inu (KOMA) is a dog-themed MEME coin, inspired by Dogecoin (DOGE) and Shiba Inu (SHIB), committed to becoming the "faithful guardian of BNB". The KOMA project team has rich experience and has successfully incubated several crypto projects with a market capitalization of over $100 million, laying a solid foundation for the development of KOMA. The project aims to build community consensus and promote the continuous growth and evolution of the BNB ecosystem.
Cheems
Cheems is a Meme project built around the classic internet meme "Cheems", this small and cute Shiba Inu, known as the "Meme King", carries the humor and emotions of global internet culture, and has now successfully penetrated from Web2.0 to the crypto world, becoming a paradigm of community-driven projects. Cheems not only attracts a large number of fans with its strong IP endorsement, but also aims to build a truly decentralized cultural symbol with the community at its core in the Meme ecosystem.
APX
APX (apollox.finance) is a multi-chain decentralized derivatives DEX. APX received investment from Binance Labs in 2022, supporting BNB Chain, Arbitrum, Optimism BNB, zkSync, Manta Network and Base Chain, with a TVL of over $350 million to date.
The main advantages of APX in attracting users are:
- Classic perpetual contracts can reach 250x leverage, and in Degen mode can provide up to 1001x leverage;
- Low slippage, as low as 0.01% slippage, and 0 slippage in V2 Degen mode;
- High trading performance, used by over 30 partner platforms including PancakeSwap;
- Position isolation, if one position is liquidated, it will not affect other positions.
a16z
a16z is a decentralized AI trading fund based on the Solana blockchain. As an "AI investment DAO", the core of a16z is to use AI agents to obtain market information on-chain and off-chain, analyze community consensus, and automatically conduct token trading. This new model aims to combine AI trading strategies and decentralized governance through tokenization, providing investors with more transparent and trustworthy investment opportunities. Moreover, the project has received the "endorsement" of Marc Andreessen, the founder of a16z, as Marc posted the concept image and official Twitter link of a16z on his Official Twitter.
AIXBT
AIXBT is a project created on the AI agent creation platform Virtuals Protocol, focusing on cryptocurrency native agents for discussion and token analysis.
Ironically, the trends of Binance's own projects are alternating between bullish and bearish, while other on-chain AI Agent projects have firmly ridden this bullish wave and shown a stable upward trend.
A Quick Look at the Second Batch of Projects
At 8 pm, the second batch of Binance Alpha projects was also announced, including:
- BNBChain: CKP;
- Ethereum: GEAR, SD, SYRUP;
- Solana: FARTCOIN
CKP
Cakepie is launched by Magpie, aiming to specifically support the long-term development of PancakeSwap. The main goal of Cakepie is to accumulate CAKE tokens and lock them as ve CAKE to obtain enhanced rewards and governance power within the platform.
Cakepie provides CAKE holders an opportunity to earn passive income from the enhanced CAKE rewards. It also offers cost-effective voting power for PancakeSwap voters and allows liquidity providers to enjoy higher APR% without the need to lock any CAKE tokens as ve CAKE.
GEAR
Gearbox is a leveraged protocol on Ethereum that enables leveraged borrowing and composability through the introduction of CreditAccounts, to promote capital efficiency in the DeFi world. Users can obtain leveraged borrowing funds on the protocol and enter mainstream DeFi protocols. CreditAccounts are independent smart contracts with specific whitelisted operations and assets, ensuring higher security for user funds and borrowing funds in each account.
SD
Stader Labs focuses on providing convenient staking solutions and maximizing user staking returns. The platform, through its suite of DeFi products including a simplified one-click staking solution, allows users to easily invest in multiple validators, leading the future direction of staking. Stader has developed liquid staking solutions, allowing users to concentrate assets without meeting full staking requirements, while minting tokens representing the staked assets, whose value grows with the increase in staking rewards. In July this year, Coinbase announced that it will list Stader (SD) on its roadmap.
SYRUP
SYRUP is a lending platform launched by Maple Finance, where $SYRUP is the key to Maple Finance's transformation of the institutional lending market. Users can convert their existing MPL tokens to staked SYRUP at a ratio of 1 MPL: 100 SYRUP, immediately participating in Maple Finance's governance and growth. Staking SYRUP will provide participants with reward opportunities tied to the ecosystem's performance.
FARTCOIN
Fart Coin belongs to the AI meme concept. In a user interaction event hosted by Truth Terminal, the platform asked the public what topics they wanted to focus on, and its first response was to continue generating endless Fart Jokes in tweets. This absurd and lighthearted humor quickly attracted a lot of attention, with Tesla even adding fart sound effects to its software, further promoting the spread of this cultural phenomenon. Against this backdrop, Fart Coin was born. It is not only known as the "best $GOAT beta", but also an experiment on the future potential of AI technology. Fart Coin, with a cynical attitude, brings Fart Jokes to the blockchain, combining technology and entertainment with a relaxed, humorous and satirical cultural attitude, becoming a unique representative of modern internet culture.
Future Outlook
The launch of Binance Alpha reflects Binance's concerns about its market position. On the one hand, OKX's web3 wallet has shone brightly in the previous Bitcoin ecosystem boom, attracting a large number of users, while Binance's own wallet has been relatively flat. On the other hand, HyperLiquid's transparent listing strategy and the discussion around it have also put considerable pressure on Binance, so it is not an exaggeration to say that Binance Alpha is a response to a losing battle.
In the past few years, Binance's listing strategy has mainly revolved around two lines: one is to choose VC-backed tokens with high risk but great potential, and the other is to list low-market-cap tokens that have already been traded on other platforms. However, the first path has not yielded ideal results, as many VC-backed tokens often experience a downward trend after an initial surge, and the market's speculative sentiment gradually cools down. On the other hand, Binance has still not found a truly stable breakthrough in the screening and launch process of such tokens.
Therefore, Binance has chosen the second path: listing low-market-cap tokens that already have a certain trading volume in the market. Project teams and communities indirectly drive the trading volume of these tokens on the Binance Alpha platform by competing for the opportunity to be listed. For example, the recent MEME token on the Solana chain and the CAT token on the BNB chain are typical representatives of this strategy. By introducing these tokens, Binance hopes to create more trading pairs and attract more users to participate in trading.
However, this strategy also brings some significant challenges. On the one hand, Binance is facing a balancing act between VC-backed tokens and low-market-cap tokens. While the choice of low-market-cap tokens may attract more attention and participation, due to the relatively weak liquidity and absorption capacity of the market, these tokens often fall into a cycle of market fatigue once they encounter price declines after a period of hype. As for high-market-cap tokens, although they can initially attract a large number of investors, due to the lack of recovery in overall market liquidity, the price volatility of these tokens is still very high, often resulting in a "high open, low close" situation, making it difficult for investors to maintain sustained confidence.
The launch of Binance Alpha has undoubtedly increased the short-term activity of the platform, but its sustainability is still questionable. As the market weakens, this high-frequency token screening and trading promotion may make investors feel fatigued. In addition, Binance's strategy will also force project teams to pay more attention to "volume manipulation" and community mobilization. In order to gain Binance's favor, project teams will have to adopt a series of aggressive measures to increase trading volume, including volume manipulation, community voting, and event organization, which may also lead to a vicious cycle in the market ecosystem. Some low-quality projects or "air coins" may temporarily gain attention through hype under this mechanism, while truly promising projects may be overshadowed by the commotion.
In summary, Binance Alpha is a bold attempt, but whether its effect is "leading the trend" or "a fleeting phenomenon" remains to be seen. In this process of game, Binance is not only betting against the market, but also racing against time, trying to bring new vitality to the cryptocurrency industry. However, any game may lead to unexpected outcomes.
