Binance has recently announced the completion of its third Launchpad initial coin offering (ICO) in 2019, with second-layer scaling solution Celer selling out its almost 600 million token supply in under 20 minutes. However, despite the extraordinary success of the platform and listed projects, trouble appears to be brewing within.
According to Binance CEO Changpeng Zhao, the Celer launchpad had the highest demand thus far — apparently taking 17 minutes and 35 seconds to conclude. In total, more than 39,000 people tried to participate in the sale but only 3,129 managed to make it through since the purchase process was swamped with problems.
Based on the stats, less than 10 percent of those that tried managed to purchase CELR tokens, leaving more than 35,000 attempted participants with a sour taste in their mouth as the problems faced in previous Launchpad sales reared their ugly heads once again.
When we sell shitcoins we get up and keep adding them
— Shadowbanned @Cameron (@shitcoinprotips) March 19, 2019
An Example of Everything Done Wrong
Binance makes the claim that Launchpad participation is first-in, first-out (FIFO), which essentially means that orders are filled in the sequence that they are placed — providing there were still tokens that remain unallocated.
However, for the CELR sale, rather than informing participants immediately whether their order was successful or not, Binance instead forced users into a queue, which forced the great majority of would-be investors to sit and wait for around ten minutes to see if they clicked the buy button early enough to purchase tokens.
Beyond this, what should have been a relatively simple process turned into a frustrating nightmare for many investors as actually getting through the purchase process was nigh impossible for the great majority of users, since the Launchpad site was completely riddled with problems.
These problems ranged from mildly annoying to downright infuriating, with many users being forced to repeatedly log in or were wrongly told that they had a Binance Coin (BNB) balance of zero and, hence, were unable to participate. For the few that managed to overcome these issues, there were often more challenges ahead — with the page reportedly becoming unresponsive for many after clicking the buy button.
As of this writing, the thousands of spurned investors have taken to the Binance Telegram, Reddit and Twitter communities to voice their opinion on the matter — with the general consensus being summed up nicely in the following tweet:
I admired you at least until today but man, do not take us for fools… 3 issues in 2 minutes, no caching issue…
1.- Log out when refreshing.
2.- Unavailabe Network.
3.- BNB Balance to 0.
— CriptoAlertasEsp (@CriptoAlertasES) March 19, 2019
In It For The Gainz (Not The Tech)
In an ICO market where the great majority of projects fail to generate sufficient funding, investors have been particularly cautious with their funds — opting to fund only projects that have significant support and hype behind them.
Most recently, the projects garnering the most attention are those that launch on the Binance Launchpad, with all 2019 Launchpad projects thus far being successful — despite launching in the same bear market within which almost everything else fails.Step 1. Buy BNB. Step 2. Try to Participate in Celer ICO. Step 3. Fail. Step 4. Sell BNB. Step 5. Rage on Twitter. Click To Tweet
However, rather than investing because they believe in the technology behind the ICO, the great majority of Launchpad backers instead appear to be investing simply because of the almost guaranteed profit they will make when dumping their Launchpad tokens on Binance right after listing.
This trend has been seen with both BitTorrent (BTT) and Fetch (FET), both of which sold out their ICO in just minutes before being listed shortly after on Binance and experiencing extreme growth. As a result of this, both BTT and FET multiplied to several times their ICO Launchpad value as trade volume immediately rocketed.
However, shortly after the initial wave of hype died down, both BTT and FET began to experience considerable losses, with BTT falling more than 25 percent since its peak, while FET is currently down more than 40 percent since its peak just 11 days ago — indicating the hype for both projects lasted just long enough to see significant gains but not long enough to sustain them.
BNB Holders Bare The Brunt
Shortly after the great majority of users failed to purchase CELR in the Launchpad ICO, the disgruntled hordes instead turned their attention back towards Binance Coin (BNB) — since many were now stuck with BNB after exchanging in to participate in the Celer ICO.
Looking to exit their position as quickly as possible, many of these holders quickly moved to liquidate their BNB back on the exchange, dumping the BNB/BTC and BNB/USDT markets by more than 3 percent as sell volume spiked considerably in the minutes immediately following the Celer token sale. Over a period of just one hour, BNB dumped from $15.77 to as low as $15.00 as sell orders multiplied tenfold over the same period.
Since then, BNB has recovered somewhat, reclaiming around half of its recent losses, climbing back up to $15.46 as traders take advantage of the price slump. This is, however, is not the first time this has happened since BNB has dumped quite considerably shortly after the last three Launchpad sales, with the most recent dump following Celer being the least severe of these.
Back on March 02, 2019, shortly after thousands failed to participate in the Fetch token sale, BNB also experienced a dump, losing eight percent of its value after unsuccessful Launchpad participants exited their positions. A similar sight occurred on February 03, 2019 after the same fiasco happened during and after the BTT sale, though BNB recovered well after both events.
What do you think about Binance Launchpad? Are people investing for the sake of the projects, or simply because of the anticipated gains to be made after the token is listed on the exchange? Let us know your thoughts below!
Images courtesy of Twitter, TradingView.