The launch of Pre-Market is another bold attempt by Binance to oppose high market value, aiming to price assets before the market opens by the community, thus eliminating the control of prices by the project party.

By: Xiaochu

Binance announced Pre-Market, and at first glance, I thought it was just the common pre-market. But after carefully reading the rules, I realized I was wrong. Its purpose is not to make more transaction fees, but to wage another war against high market value projects.

It seems to have become a consensus that a project listed on Binance will have a high market value. After the initial exchange offering (IEO), the retail investors are harvested, Binance is criticized, and only the project party and the yacht models are smiling. What's even more deadly is that the project party makes enough money and starts to relax.

So, what's different about Pre-Market? Why is it possible to break this phenomenon? The core is that the chips in Pre-Market are only distributed by Launchpool, which means there are no project parties, market makers, or chips in the name of airdrops. Let the community set the price to eliminate high market value.

Let's first talk about the current tactics of the project party. Before listing, they gather a strong and hardworking team, top VC investments, a grand narrative, and data contributed by the community. Then they wait to be favored by the "hand of God." Then everything starts to change. At the opening, the project party has strong control, they have sufficient chips, market makers working for them have rich trading experience, first-hand fund data, and a good understanding of the human nature of the retail investors. In addition, for the airdropped chips, the project party can use methods such as server crashes to control the pace of chips entering the exchange. They are like gods with eyes in the sky, having a crushing advantage over the retail investors. And on the opening day, the project party can make a lot of money.

If you often read my tweets, you will know that I have disclosed multiple times that many project parties cash out heavily on Binance at the opening. The proportion is very exaggerated. If Launchpool accounts for 5% of the total, the project party can sell 5% or even more. At least $50 million can be cashed out at once, and in projects with good liquidity, it can exceed $100 million. The root of all this is that at the opening, the project party and their market maker friends use their advantage in funds and chips, as well as their rich experience, to control the pricing on Binance and cash out at a high market value.

After the launch of Pre-Market, this set of tactics will be broken. Pre-Market elsewhere is a means of trading the listing fee in advance and does not involve actual tokens. But in Binance's Pre-Market, the chips being traded are from Launchpool. So these chips are in the hands of users participating in Launchpool. Based on the participation in previous periods, there are 1 to 2 million participants in Launchpool. So these chips are relatively dispersed and not easily controlled in a centralized manner. And based on my own speculation, Launchpool tokens are basically given for free, it's just a matter of whether the feast is luxurious or not, so the sensitivity to price is not high. This makes it easier for the market value at the opening not to be very high.

In Pre-Market, only Launchpool chips are traded, and the project party and market makers cannot participate. We know that at the beginning, we and the project party are a family, walking together, building together, and envisioning the universe together. But once listed on Binance, the project party becomes a complete scumbag. They only want to sell us tokens at a high price, so they can go to yacht parties with their girlfriends. We still want to build, we still want to reach for the stars, and now with Pre-Market, this scumbag cannot manipulate the price through the advantage of funds, chips, and so on. So, we are genuinely buying and selling, without deception. And Binance sets a limit on holdings to avoid the influence of large holders or malicious individuals on the price. In Pre-Market, it is a market where the community sets the price fully, not the project party. So, logically speaking, because the project party previously wanted to list at a high market value to cash out, now that the project party's influence on the price is gone, the market value of the project in Pre-Market will definitely decrease.

Once Pre-Market has a price, it has a very significant guiding effect on the opening of the spot market, especially forming a large expectation psychologically, or what is called the anchoring effect. Previously, at the direct opening, market makers could first raise the price, sell some, and then add airdrops, etc., and the price would naturally fall back. But when the price drops to a certain extent, retail investors will think: Wow, it has dropped by 50%, it's already very cheap, after all, this is a project with a future, with the support of the "W God" and the "M Goddess," I can buy, all in. But with a low price in Pre-Market, even if the project party raises the price again, retail investors may consider selling, rather than buying.

People are a very mysterious species. When something drops from $100 to $80, you will think it's really cheap, a big discount, a good opportunity that only comes once a year. But when it rises from $60 to $80, you will think it's too expensive, let's wait. You don't believe it, but that's human nature.

In summary, the launch of Pre-Market is another bold attempt by Binance to oppose high market value, aiming to price assets before the market opens by the community, thus eliminating the control of prices by the project party. And through psychology, it affects the actual spot price after the opening. It allows retail investors who want to participate to do so in advance, rather than being harvested by the project party at the opening.

The actual situation needs to be verified by practice. But Binance's intentions are good, and I hope to achieve the expected results. After all, the market value of projects listed now is too high, and the secondary market is almost out of soup. In the future, good quality projects can also be listed with peace of mind. Because click, click, click, click, my mouse has already broken twice.

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