Analysis of the Market Performance of Low Circulation/High FDV Tokens
Recent analysis by PANews indicates that memecoins outperform newer venture capital (VC) projects with high 'Not Circulating Supply (NCS)' struggles; although there are exceptions such as projects launched in January 2024, in general, lower NCS indicates better performance; narrative and market conditions are critical, as evidenced by the strong recent performance of FET, FTM, PENDLE, RNDR, AGIX, and AKT.

In recent weeks, there has been considerable discourse surrounding low circulation/high FDV tokens, as reported by PANews. An analysis of the market performance of these tokens has yielded some intriguing results.
Memecoins performed the best, with their entire supply circulating from day one, according to the study. Notably, both new and ancient Memecoins demonstrated outstanding performance. Conversely, later venture capital projects characterized by an exceptionally high "Not Circulating Supply (NCS)" exhibited the poorest performance.
Although the overall trend was not observed, a few outliers did exist. These January 2024-launched initiatives demonstrated that new ventures with a high NCS could still achieve success. Their accomplishments were ascribed to their narrative.
It was discovered through closer inspection that although projects with a high NCS frequently exhibited subpar performance, there was no discernible pattern of distribution among projects with exceptionally low or high NCS. In the past three months, the market performances of quality initiatives with low NCS values, such as FXS (NCS 20%), MASK (NCS 4%), and RPL (NCS 0%), were -44%, -10%, and -22%, respectively.
Nevertheless, one encouraging finding was that projects exhibiting a reduced NCS demonstrated superior performance on average, irrespective of the age of the project. The principal determinants of asset performance are market conditions and narrative, it was determined. In contrast, initiatives with a high NCS frequently underperform and are more suitable for hedging purposes or during negative markets.
With only two noteworthy exceptions, low circulation/high FDV projects exhibited significantly inferior performance when compared to high circulation/low FDV projects. However, with the exception of a few Memecoin outliers, initiatives with high circulation and low FDV tended to exhibit superior performance.
In conclusion, with a few notable exceptions, low circulation/high FDV ventures typically perform inadequately. Nevertheless, locating these anomalies necessitates considerable exertion, and achievement is not assured. Although data indicates that Memecoin performs exceptionally well in this regard, not all individuals might be inclined to engage in its trading. What is the solution? Develop into a narrative trader by locating the optimal equilibrium point. Recent analysis revealed that the most successful projects had an NCS ranging from 10% to 50%. Such projects included FET, FTM, PENDLE, RNDR, AGIX, and AKT.
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