Why Do Cryptocurrencies Crash After Binance Listings?

The world of cryptocurrencies is notorious for its volatility, but one consistent trend has raised eyebrows: the dramatic price crashes experienced by multiple cryptocurrencies following their listing on Binance, the world’s largest digital asset trading platform by volume. This phenomenon has prompted a deeper investigation into possible causes, with various factors playing a significant role. HC Capital, a crypto venture firm, has highlighted specific tokens such as AEVO, PORTAL, STRK, SAGA, and DYM as crashing by over 80% from their all-time highs post-listing. Other tokens have similarly seen significant declines, with many falling between 60% and 70%. The crypto community is now grappling with the implications of these rapid devaluations and their potential link to insider trading or market manipulation.

Intrinsic Volatility of the Cryptocurrency Market

A primary contributor to the post-listing crashes is the intrinsic volatility of the cryptocurrency market. Cryptocurrencies are highly speculative assets, and their prices can fluctuate wildly within short periods. This volatility is often amplified during the initial stages of a token’s life, where investor excitement and speculative behavior drive prices to unsustainable levels. A pertinent example of this is the 2021 market bull run, where tokens like The Sandbox (SAND) and Decentraland (MANA) experienced meteoric rises fueled by hype. Once the initial excitement dissipates, these inflated valuations hit the inevitable market correction phase, resulting in significant price drops.

Additionally, the low supply of newly listed tokens exacerbates their price volatility. When a token has a limited supply, even minor trading activities can cause substantial price movements. Investors often gamble on these smaller altcoins, driven by the prospect of quick gains. This speculative behavior results in rapid price escalations that are typically followed by equally rapid declines. Each new listing on Binance attracts a flurry of market activity, further fueling the already erratic price behavior. The combination of speculative investing and low token supply creates a perfect storm for price volatility, making significant crashes almost inevitable.

High Fully Diluted Valuations (FDVs)

Another critical factor contributing to the post-listing price crashes is the inflated fully diluted valuations (FDVs) observed during the initial listing period. FDV represents the total value of a cryptocurrency project, factoring in all circulating tokens. When new tokens are listed on Binance, the initial hype often sends these valuations soaring to unjustifiably high levels. Investors flock to purchase these newly available tokens, pushing prices up in the short term. However, these inflated valuations are rarely sustainable, and market corrections become imminent once the initial excitement wanes.

As these corrections take place, the true market value of the token starts to emerge, often revealing that the earlier hype had led to an overestimation. This adjustment phase can be severe, with prices dropping dramatically from their initial peaks. Tokens such as AEVO, PORTAL, STRK, SAGA, and DYM have all witnessed this pattern, plunging by over 80% from their all-time highs post-listing. The inflated FDVs, coupled with the speculative nature of early trading, make the post-listing period particularly precarious for investors. These factors underscore the importance of thorough market analysis before diving into newly listed tokens.

Potential Insider Trading and Market Manipulation

One major factor contributing to post-listing price crashes is the inflated Fully Diluted Valuations (FDVs) seen during the initial listing period. FDV represents the total value of a cryptocurrency project based on all circulating tokens. When new tokens are listed on Binance, initial hype often drives these valuations to excessively high levels. Investors rush to buy these newly available tokens, causing short-term price spikes. However, these inflated valuations are seldom sustainable, leading to inevitable market corrections once the initial excitement fades.

During these corrections, the true market value of the token starts to become apparent, often revealing that the earlier enthusiasm had led to an overestimation. This adjustment phase can be dramatic, with prices falling significantly from their initial highs. For example, tokens like AEVO, PORTAL, STRK, SAGA, and DYM have all experienced this trend, plummeting by over 80% from their peak post-listing. The combination of inflated FDVs and speculative early trading makes the post-listing period particularly risky for investors. Thus, thorough market analysis is crucial before investing in newly listed tokens.

Explore more

How Is Silk Typhoon Targeting Cloud Systems in North America?

In the ever-evolving world of cybersecurity, few threats are as persistent and sophisticated as state-linked hacker groups. Today, we’re diving deep into the activities of Silk Typhoon, a China-nexus espionage group making waves with their targeted attacks on cloud environments. I’m thrilled to be speaking with Dominic Jainy, an IT professional with extensive expertise in artificial intelligence, machine learning, and

Why Is Small Business Data a Goldmine for Cybercriminals?

What if the greatest danger to a small business isn’t a failing economy or fierce competition, but an invisible predator targeting its most valuable asset—data? In 2025, cybercriminals are zeroing in on small enterprises, exploiting their often-overlooked vulnerabilities with devastating precision. A single breach can shatter a company’s finances and reputation, yet many owners remain unaware of the looming risk.

Is the Traditional CDP Obsolete? Meet Customer Data Fabric

As we dive into the evolving world of marketing technology, I’m thrilled to sit down with Aisha Amaira, a seasoned MarTech expert whose passion for integrating technology into marketing has helped countless businesses unlock powerful customer insights. With her deep expertise in CRM marketing technology and customer data platforms, Aisha is the perfect guide to help us understand the shift

Trend Analysis: AI-Driven Cloud Security Solutions

In an era where cyber threats evolve at an unprecedented pace, with over 53% of IT leaders reporting a surge in AI-driven attacks as revealed by the latest Hybrid Cloud Security Survey, the digital landscape stands at a critical juncture, demanding innovative solutions. The proliferation of hybrid cloud environments has amplified vulnerabilities, making traditional security measures insufficient against sophisticated adversarial

SEO 2026: Navigating AI Threats and Original Content Wins

What happens when machines start outranking humans in the digital race for attention? As search engines evolve at lightning speed, artificial intelligence (AI) is rewriting the rules of search engine optimization (SEO), leaving professionals scrambling to adapt. By 2026, the battle for visibility could hinge on a single factor: the ability to balance cutting-edge technology with the irreplaceable value of