Dump- A common Language
‘Why such a low price?’ has now become a regular question even in AMA sessions for projects that just got listed in exchanges. The question does not exclude projects that have long listed which are trading below their initial or ICO price. It was the opinion of investors in earlier days that bounty hunters cause price dump because they want to sell faster. This idea was later erased as time went on for a reason visible to all. Investors also dump tokens from projects which did not distribute bounty rewards before they listed in exchanges. Scenario like this gave bounty hunters to counter the early opinion and brought all to an understanding that dumps can occur because of different reasons other than bounty hunters.
Reasons for Dump in prices
Projects that give red flags of failure can easily be dumped by community members who are afraid and want to mitigate against total loss on investments. Other reasons can range from FUD (fear, uncertainty, and doubt), the inability for the project to deliver as expected, etc.
How can you recognize a real trader or a beginner?Sydney Ifergan (@SydneyIfergan) February 20, 2019
Easy, a real trader will trade with limit (high).
A beginner will sell at the market price, means low.
What the beginners don’t know is that usually”market” will bring less and Dump the token price.#cryptoexchanges #Cryptotrader
Sydney Ifergan, the CEO of The Currency Analytics pointed that “The dumping problem is people trying to sell fast according to the market price” He had already made it clear that when non-traders go to cryptocurrency exchanges, they want to sell their tokens faster than anybody else. Therefore, they place a sell order that is lower than the lowest sell order so that their orders can be completed first. If this continues to happen, the price will continue to dump.
The point Sydney made above is valid, and can even be worse- People can begin to take low buy orders without worrying about what their action will do to the price of the token in question.
Ultimately, price dumps occur when sellers are willing to sell more than buyers are willing to buy in a market condition. In other cases, dumps are caused by scammers who get tokens through unscrupulous means. Somehow, they are fishbone in the neck of projects.
Could Dump be Advantageous?
Looking away from the causes of low market prices, dumps can be a blessing to start-ups. When community members sell the tokens with them, they give other people who do not have the token an opportunity to possess some. Definitely, it increases the number of token holders for a project. If the number of token holders increase, it means the project itself is gaining more visibility.
Dumps also increase the number of tokens in circulation for well-meaning project. Since projects gain top position on CoinMarketCap through the market capitalization or the volume and total price of tokens traded per time, projects experiencing dumps have the opportunity for a slight movement up the list because of an increased volume and trade.
Essentially, there is no project that cannot experience a ridiculously low market price no matter how genuine they are. Days of shooting to the moon for cryptocurrency projects is passed, there is a need for stabilization for the cryptocurrency sphere as tweeted by Sydney.
Being an advisor and ambassador for several #ICO’s and #STO’s, I’m still seeing comments saying “to the moon”, lets be honest “#tothemoon” was few years ago today our #crypto industry need stability.. so… the new sentence should be “#STAYONTHEEARTH”— Sydney Ifergan (@SydneyIfergan) February 22, 2019
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