There are many types of investors and trades. There are those totally disillusioned, stone-like and emotionless, who enter and exit crypto assets following rigorous strategies. Another more colorful class, the “lyricists”, get excited about keeping certain cryptocurrencies in their wallets, rejoicing at the profits and crying at the losses of their favorite companies and projects.
Another more terrifying degens which I have come to talk about today, unearths assets from the depths; They trade tokens that have been dead for months, if not years, in abandoned, illiquid sinkholes.
This October 11, the market data analysis company, Kaiko, released a graph of the weekly trading volume of FTX Token (FTT), the digital asset issued by the bankrupt company FTX . This is the company whose CEO, Sam Bankman-Fried, is currently on trial for alleged fraud in the United States. According to the graph presented, FTT's weekly trading volume reached $100 million at some point in early October. At some point between March-April, the same token surpassed $400 million in volume. Taking these data into account, several concerns arise. Shouldn't the trading volume of a token without any use case or utility be close to zero, as logic dictates?
So, who dares to trade worthless assets? What is the psychological motivation behind the grim habit of trading corpse tokens? Who would trade FTT, a cryptocurrency whose total supply has been unlocked since May 1, 2022, and whose price has been experiencing a definite downward trend for more than a year?
Trying to understand what's going on with people (and FTX Token volume)
Let's look at 3 possibilities:
- As happened before with the fall of Terra and its token (LUNA) , it is likely that many investors of the “lyric” caste bought, during its boom, handfuls of FTT tokens. Unable to predict the catastrophe, these investors suddenly found themselves imprisoned by price declines, and have huge unrealized losses. Being unable to accept such large capital losses, is it possible that these investors continued, or in the worst case still continue, buying FTT to average their entry prices?
- As with other tokens that have descended into the other world, there is never a shortage of promises of resurrection. That John J. Ray III, new CEO of FTX, will revive the ruined token? That such a strong and important token could never fall, and any loss is temporary? Any reason to have or create hope in the rebirth of FTT would do.
- Taking advantage of the plight of the trapped or ignorance in general, certain ' pump and dump ' schemes or predator-minded traders could be creating or motivating promises of resurrection and urging people to inflate the prices of FTT, an asset hypervolatile (or an explosive corpse?) due to its low liquidity. Sound crazy? It would not be the first time this has happened, nor the last: LOOM, the native token of a network with the same name, would have recently been the subject of an "artificial increase" in its price on Upbit, a Korean exchange that allegedly practices these schemes with assiduity.
In short, there is no doubt that there are people buying and selling FTX Token. The motivation that animates their actions, there being other solid cryptocurrencies to invest in such as Bitcoin (BTC), Ethereum (ETH), and Monero (XMR) is difficult to understand, and the causes proposed in this article are assumptions, but assumptions based on events that have happened in a closely traced manner. in the past.
Having read this far, you can say that you know a little more about the psychology of that underground class of traders who are not often seen and who, for better, worse or inevitably, are part of our world.
