In the cryptocurrency market, volatility and risk always go hand in hand. Recently, the popular tokens KOGE and ZKJ on the Binance Alpha platform experienced a shocking flash crash, with prices dropping by 55.78% and 83.7%, respectively.
This incident not only caught many investors off guard but also sparked widespread discussion about the Binance Alpha mechanism.
Event review: Why did the token price crash?
On June 14, the KOGE and ZKJ tokens began to show price fluctuations, which market analysts found closely related to the liquidity withdrawal and continuous selling actions of several large addresses.
With the actions of these addresses, the token price rapidly declined, ultimately leading to a complete collapse on June 15.
The price of ZKJ fell from a high of $1.98 to a low of $0.25, while KOGE dropped from $62.81 to $8.48.
Binance officially responded quickly, stating that it has noticed significant fluctuations in token prices and will adjust the Alpha point calculation rules starting from June 17, 2025, 00:00 (UTC) to reduce systemic risk.
This adjustment means that trading volume between Alpha tokens will no longer be counted in point calculations.
Discussion on mechanism: Pros and cons of Alpha points
The point mechanism of the Binance Alpha platform has always attracted a large number of users to participate by obtaining points through token trading.
This flash crash incident exposed some issues in the mechanism. Points are like exam scores; while they can bring airdrop rewards, they can also become traps for investors.
To prevent similar incidents from happening again, Binance may need to change the way points are earned.
Increase point sources to encourage community interaction, rather than solely relying on token trading.
Establishing stricter monitoring mechanisms to prevent large players from manipulating the market is also a direction worth considering.
Project response and market reflection
In response to the flash crash incident, Ian, the founder of the KOGE project 48 Club, made a statement in the Binance Square, denying any business dealings with the ZKJ project team and stating that he had never held ZKJ tokens.
Although the project team tried to distance itself from the incident, the market's response has already shown concerns about liquidity risk.
Ultimately, the ones most hurt are still the retail investors in the market. The large players completed liquidity harvesting, while retail investors became the harvested.
This liquidity feast reminds us of the high risk and uncertainty in the crypto market, requiring investors to assess market dynamics more cautiously.
Conclusion: The future of the crypto market
As the cryptocurrency market continues to evolve, similar incidents may continue to occur. For investors, understanding market mechanisms, paying attention to key figures' movements, and staying vigilant will help make more informed decisions in this challenging field.
This incident of Binance Alpha may just be the beginning; future market changes are worth our continued attention.