Binance co-founder He Yi wrote an article today summarizing the changes in the cryptocurrency market since 2017, and pointed out that the previous profitable strategies are no longer effective in the current market. She stated that the internal strife within rug pull studios and L2 projects has turned into a farce, indicating that the era of rug pulling may be coming to an end. In addition, she once again responded to the criticism that Binance frequently lists VC tokens with overvalued valuations, which leads to retail investors being taken advantage of.
Table of Contents:
Making money during the ICO/IEO era by grabbing shares and being fast
The collaboration between top-tier projects and rug pull studios created impressive data
He Yi: The era of rug pulling may be coming to an end
He Yi, co-founder of Binance, entered the cryptocurrency market in 2014 and co-founded Binance with Zhao Changpeng in 2017, accumulating over 10 years of industry experience to date. Today, she published an article on Binance Square, summarizing the money-making methods from 2017 to the present, and pointed out that the current market environment cannot rely on past methods to make profits.
First, He Yi pointed out that during the ICO era in 2017, public fundraising directly replaced venture capital (VC) and private equity (PE). The bull market from 2017 to 2018 was supported by early influential investors (OG), and as long as these OGs invested in projects, they could make money by grabbing shares.
By 2021, the rise of DeFi has made the market more diversified, and investors can make money by being fast in chasing meme coins. During the IEO era, investors could also negotiate with project teams to secure a share for users, resulting in lower pricing for listed projects. The investment strategy during this period was “buy new, not old.”
However, He Yi immediately stated that IEOs are now considered legally risky in most countries, so they can only be conducted through airdrops. This means that the market pricing will depend on supply and demand. If there is a large circulation, the opening price will be lower and the project’s performance will be relatively stable, such as BB and Lista. However, compared to 2021, the current market lacks sufficient washout processes, with prices rising too quickly and lacking stability.
He Yi further explained the market phenomenon this year. She mentioned that the recent market rally was mainly triggered by the launch of Bitcoin ETFs and was driven by collaboration between some top-tier projects and rug pull studios. They jointly created impressive data to attract more VC funds.
Yesterday, KOL @Aunt_ww criticized Binance in a tweet, accusing it of violating the fairness spirit of cryptocurrencies by frequently listing VC tokens with inflated prices and overvalued valuations, diluting market liquidity, and making retail investors the bagholders of VC projects.
In response to this, He Yi addressed it in today’s article. She first acknowledged that if we observe the top VC players in the market, their scale is all over one billion US dollars, which does push up the pricing of good projects. However, she stated that these project teams, who are rich and have users, have the confidence to list on many centralized exchanges (CEX) even without listing on a specific platform. They are also willing to list on decentralized exchanges (DEX) or even launch on their own chain’s DEX. Therefore, she emphasized that:
He Yi then pointed out that the market has indeed changed until today. She said:
He Yi questioned whether the market without VC investments and project teams would be healthier. She pointed out that in every market cycle, there are some projects that can survive the bull and bear markets, but more top-tier projects fall along the way. Whether it is web2 or web3, successful entrepreneurial projects are extremely rare, and projects that can cross the divide and survive the cycles are even rarer. Therefore, she reminded that investing carries risks, and one must be cautious when entering the market.
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