2019 Capital Flows of Crypto Assets Investors

2019 was a challenging year for many Crypto Assets investors. As many reflected on their investment returns, they couldn't help but exclaim, "The gains brought by luck were ultimately taken away by lessons learned." So, where did the investors' funds go? Let's take a look back at several major hotspots in the Crypto Assets market in 2019.

Initial Prosperity: First Exchange Issuance ( IEO )

The IEO model gained widespread attention in early 2019. Some well-known trading platforms launched token issuance platforms, and the first IEO project sold out in just 13 minutes. Subsequently, other large exchanges followed suit, with some projects even completing three rounds of buying in 19 seconds. This frenzied scene led many investors to mistakenly believe that a bull market was on the horizon.

However, a rapid rise is often accompanied by a similarly rapid decline. According to statistics, the vast majority of IEO projects experience a severe price drop after reaching their peak. About 86% of the projects have a decline of over 50%, with nearly one-third of the projects experiencing a drop of even 80%, nearly going to zero. This sharp decline has shattered the wealth dreams of many investors and has also caused the IEO model to gradually lose its appeal.

Ephemeral: Exchange Platform Coin

With the rise of the IEO model, coupled with mechanisms such as buybacks, trading mining, and dividends, the platform coins of major exchanges also experienced a surge at the beginning of 2019. A research report showed that the platform coins of several well-known exchanges achieved significant increases in the first quarter, with some even reaching around 800%.

But this prosperity did not last long. With the decline in IEO popularity, a cooling market, and the diversion of other speculative projects, exchange platform coins averaged a 22% drop in the third quarter. Investors who hoped to get rich quickly by heavily investing in platform coins ultimately found that platform coins became a mirror reflecting market conditions.

Brief Carnival: Innovative Model Token

In 2019, a new type of token model known as "resonance" quickly gained popularity. This model allows users to exchange a certain token for Bitcoin in a one-way manner, with its price linked to Bitcoin. The most famous case created a myth of a 40-fold increase within two months, once ranking among the top ten in the global Crypto Assets market.

However, such innovative models often have cyclicality, and the speed of collapse may be quicker than expected. When large holders begin to sell off for cash, ordinary investors often suffer heavy losses. This Ponzi scheme-like operation ultimately cannot escape the fate of collapse.

Huge Scam: Fund Pool Project

The year 2019 witnessed the largest scale collapse of a funding scheme in the history of Crypto Assets. A project involved an amount as high as 30 billion USD, including a large number of Bitcoins, Ethereums, and various other Crypto Assets. The project promised high returns of 10% to 30% per month, attracting numerous investors. However, this unrealistic promise ultimately ended in a crash, resulting in significant losses for investors.

Another striking case is a certain blockchain project, whose token price skyrocketed over 100 times in a short period, briefly entering the top ten by market capitalization. By attracting funds with high interest, promoting with high commissions, and manipulating prices through strict control, the project raised 5.2 billion within six months. However, in the end, this model could not escape the fate of collapse.

High-Risk Games: Futures Contract Trading

Compared to the spot market, the Crypto Assets futures contract market is undoubtedly a higher-risk area. Frequent news of large liquidations, often involving billions in losses, reflects the high risk of this market. In this field, even if substantial profits are gained in the short term, one may encounter even greater losses in the next moment. Therefore, for most investors, it is crucial to approach futures trading with caution.

Conclusion

Looking back at the Crypto Assets market in 2019, the importance of rationality and value investing has become increasingly evident, whether in profit or loss. As a qualified investor, maintaining calm and rationality will be key to achieving better returns in the market of 2020 and beyond.