GSR Study Finds Most Token Listings Fall Below Issue Price Within 3 Days

What happened

A GSR study of over 2,300 token listings on major exchanges since 2013 found that the median token fell below its issue price within three days and dropped 50% within 90 days. The study also noted that median circulating supply at listing fell from 38% in 2017 to 13% in 2020 and remained in the teens or low 20s in later years, with smaller tokens having higher supply.

Confirmed

Global impact / market context

This suggests that many newly listed tokens lose value quickly, which could hurt investors who buy at the listing price. It may also indicate that projects are listing with a small portion of tokens available, potentially increasing price swings and affecting investor trust in new digital assets.

Analyst inference

If most tokens fall after listing, exchanges might see reduced trading activity or investor caution, leading to lower revenue from trading fees. Companies planning to list tokens may adjust their strategies, such as releasing more supply upfront to avoid steep declines, which could influence market dynamics and investor positioning.

Analyst inference

What to watch

1. The study included over 2,300 token listings and looked at tokens that were later delisted, which means the data covers a wide range of outcomes, including those that failed. Confirmed
2. Investors could watch upcoming token listings to see if they follow the pattern of falling below issue price within three days, which might help in making entry decisions. Proposed
3. Observe whether exchanges or projects change their listing practices, such as increasing the circulating supply at listing, to see if that leads to better price performance over time. Analyst inference

Evidence

• binance.com