How to avoid rugpulls: Cosmo (atom) Lessons and market feeling
The cryptocurrency world is constantly developing, and new projects appear every day. One of the most important threats related to cryptocurrency investments is Rugink, a phenomenon in which the project token has been stolen or disappears for no clear reason. In this article, we will examine how to avoid rugpulls and get valuable intuitions about the sense of market with two unusual examples: Cosmos (Atom) and its last fights.
Rugpulls: What are they?
Rugpull is a kind of Ponzi program in which the project or investors team is not incorrectly evaluated to cover losses, and not actually ensure the value of user. This can lead to theft of millions, if not billions, cryptocurrencies of dollars.
Kosmos (ATOM): Lesson of a market sense
In 2019, Cosmos, a decentralized independent network and Open Source Blockchain platform, underwent a destructive rugpull, which swept over $ 2 billion. Native token of the project, atom, was one of the most popular coins and widely used on the market.
To understand why this happened, we must analyze the sense of the market surrounding the cosmos. At the peak of noise, the price of the atom increased to the stars from around USD 15 to over 90 USD, attracting millions of investors. The family token of the project has been aggressively mentioned by whales and retail investors, and prices that often reach millions of millions.
However, under the surface, the basic cosmos infrastructure quickly deteriorated. The team lost control of their treasure, which led to a lack of liquidity for investors and users. In addition, there were concerns about scalability, usability and general profitability of the project.
Why Kosmos (Atom) experienced such a serious rugpull?
There are several reasons why the space market adopted an unexpected phrase:
- Tokenomics: The token has been launched with special care for utility, not fluidity, reaching a swollen price.
- Lack of management: The lack of responsibility and transparency of the team allowed them to mislead funds and cover losses.
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Lessons with Cosmos (atom)
Mentre La Storia di Cosmos è una Storia Avvertita, Fornisce Anche Preziose Lezioni:
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- Płynność jest ważna: Upewnij się, że masz wystarczającą płynność, aby wykorzystać wahania rynku.
- Management is crucial: Strong management structures are necessary to maintain control and transparency.
feeling Mercato: History of caution
The sense of the market surrounding the cosmos (atom) during its peak is a clear reminder of the risk associated with the investment in cryptocurrencies:
- High expectations: Hype surrounding the atom led to unrealistic price goals, which ultimately affected proportionally.
- Excessive dependence on marketing: Whales and retail investors have become excessively dependent on marketing campaigns and influential social media, ignoring a fundamental analysis.
- No diversification:
The market is becoming more polarized, and many investors have blocked a specific token or project without taking into account a wider market context.
Avoid rugpulls: cryptocurrency guide
To avoid rugpulls, follow the best practices:
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