💥Why can a coin with locked chips still rise all the way?
Currently, the coins that can appear on Binance's gainers list are basically low market cap coins with high control, such as today's $TRADOOR , $pippin ,
$BANANA . The top 10 chips of these coins are close to 99%. The first reaction is definitely that with such concentrated chips, they will eventually return to the bottom, but where does the fund come from for the operator to push the price up? I used to think this way, but then I realized it from a different perspective.
Because when the chips are almost in the hands of the operator, the market becomes an internal circulation of the project party. The operator only needs to place buy orders on account A and sell on account B, transferring from left hand to right hand, and the market can be locked by the project party, naturally raising the price without needing a lot of funds.
Then the question arises: If the operator doesn’t spend money to push the price up, how do they make money? In fact, the operator's profit comes not from the price rise, but from the death spiral of the short sellers. Our logic for shorting is that you borrow coins betting on a decline, for example, shorting at 1 and covering at 0.8, you earn 0.2. But what if the price is forcibly pushed up to 2? You directly get liquidated, not only losing your margin but also needing to buy back the chips at the liquidation price to return them.
At this point: the money you lose is earned by the operator, and the platform's fees also come from you. The forced liquidation 'buyback' essentially provides a boost for the operator to push up the price, so why does the operator dare to keep pushing the price up? Because the more short sellers there are, the more they can harvest with each price push. Moreover, due to the concentration of chips, their cost of pushing the price up is almost zero.
This is the logic of why the operator wants to push the price up: first squeeze the short sellers dry, then find the right moment to slowly let go. The bottom will definitely come, which can be compared to
#AIA , but at that time, the operator will have drained the last drop of blood from the retail investors.
#加密市场反弹 #香港稳定币新规