RMB-denominated small currencies surge: opportunity or fleece?
1. Short-term market sentiment and capital flow hotspots: Collective rise in 24 hours, especially THE with a rise of over 30%, reflecting concentrated buying in the short-term market for these currencies. This may be driven by project benefits (such as technology upgrades, official cooperation announcements), community speculation, or short-term capital games, driving sector popularity. Elasticity of small currencies: Most of the listed currencies are low-priced small currencies, which have a small circulating market value, and a small amount of capital can leverage prices. The amplitude of price increases and decreases is large and the elasticity is high, but it also means that the volatility is more likely to be manipulated by capital, with risks and opportunities coexisting.
2. Long-term value is questionable and lacks fundamental support: Only looking at the list of price increases does not reflect the core value logic of the actual implementation of the project, technological innovation (such as blockchain underlying performance, ecological construction), and compliance progress. Most small currencies face a “hype-fall” cycle in the long run. If there is no continuous ecological empowerment, the rise will not last long, and it may fall sharply due to profit-taking sales. Industry cyclicality and policy risks: The digital currency market is greatly affected by the cycles of leading currencies such as Bitcoin and global regulatory policies. The current rise may only be a short-term local market. If Bitcoin weakens and regulation becomes stricter (such as exchange compliance review), the callback pressure of these small currencies will rapidly increase, and investors need to be wary of chasing high risks.
3. Implications for ordinary investors: Short-term speculation needs to be cautious: The surge of small currencies attracts attention, but the volatility is drastic. It is suitable for investors with extremely high risk preferences and strict profit-taking and stop-loss strategies. Ordinary investors are prone to being “fleeced” by blindly participating. Return to the logic of value investment: In the long run, digital currency investment should focus on projects with clear application scenarios (such as DeFi ecology, Web3 landing), technological advantages (such as Layer2 expansion, cross-chain), and compliance layout, rather than simply pursuing short-term gains, in order to reduce the impact of market fluctuations and share the long-term development dividends of the industry.
