Build On Bitcoin (BOB), the cryptocurrency token of Bitcoin DeFi, has shown a dramatic surge today, rising over 100% in a day and forming what traders often call a 'God Candle.'
On the surface, this rise may seem attractive, but looking at the underlying fundamentals of the tokens, serious concerns emerge that investors cannot ignore.
Build On Bitcoin raises concerns
On SNS, BOB is labeled as a 'serious warning' due to structural risks in token distribution. Data from Go Plus Security indicates that the top 10 holders manage over 93% of BOB's total supply. Such extreme concentration is often associated with operational risks where a few wallets can influence the market direction.
Another significant issue is that the entire liquidity pool of BOB is unlocked, exposing the project to the potential for a rug pull. Without locked liquidity, malicious actors can instantly drain the pool, leaving small traders with worthless tokens. These warnings align with characteristics commonly seen in scam tokens, indicating that BOB is an asset requiring sufficient scrutiny before entering.
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Technically, BOB's recent performance raises further concerns. The Chaikin Money Flow (CMF) indicator has consistently shown outflows for several days, indicating capital is leaving, yet the price has surged sharply. This divergence suggests that it is mainly driven by a boom and thin liquidity, not genuine demand.
A 107% daily surge is often considered a speculative move without supporting inflows and is likely to reverse sharply. The lack of actual buying pressure to maintain high levels increases the probability of a sharp correction. Momentum without capital support does not last long in the DeFi market.
During today's surge, BOB reached a past high of $0.0294 before being pushed back about 15%, raising concerns over volatility. The token is above the support level of $0.0238, but due to weak fundamentals and speculative nature, the likelihood of maintaining this level is low.
If sentiment shifts and holders begin to sell, BOB could quickly drop to $0.0195, with further declines possible to $0.0146 as liquidity dries up. This could erase much of the recent gains.
However, if fundamentals improve and support from actual investors appears, BOB may attempt a rebound toward the past high of $0.0294, with potential to exceed $0.0320. This development would negate bearish views.
