Today we will discuss a coin that keeps declining, WLFI. Since its launch, this coin has dropped 46% compared to other altcoins, performing far worse than the market! What’s even more confusing is: there are no token unlocks, the circulation is stable, so why can’t the price rise? Today, we will thoroughly analyze WLFI’s predicament from three perspectives: on-chain data, market sentiment, and capital flow.
1. Performance Review: Why has WLFI continuously underperformed the market?
First, let’s look at a set of comparative data:
WLFI has decreased by 46% compared to non-top ten altcoins
Although there are occasional short-term rebounds, the long-term trend is consistently downward
In contrast, while Trump meme coins also fell by 38%, the reason was a doubling in supply
And WLFI, without a token dilution issue, has dropped even more severely
This raises a key question: Since there is no selling pressure, who is continuously selling?
2. On-chain data revelation: Changes in holders across three major chains
WLFI is issued on three chains, and the distribution of holders is quite interesting:
Ethereum chain (main market):
80,000 holders, over 300 whales
In the past 30 days, the number of holders at all levels has been declining
This is the trend that needs the most attention
Sol chain:
27,000 holders, only 20 whales
The number of whales has recently slightly increased, but the impact is limited
Binance Smart Chain:
12,000 holders, fewer whales
Retail investors are increasing, but the base is too small
The conclusion is clear: The loss of holders on the Ethereum chain is the main reason for the price decline.
3. Contract market: The amplifying effect of perpetual contracts
Besides the spot market, perpetual contracts have a greater impact on prices:
Spot trading volume: $10 million (Binance)
Perpetual contract trading volume: $58 million, six times that of spot
Most traders are going long and need to pay funding rates to short sellers
In the big cleanup 10 days ago, a large number of WLFI long positions were liquidated
But unlike other altcoins, WLFI has failed to regain lost ground
More importantly: The open interest is at a historical low
This means speculative funds are withdrawing, lacking new funds to push prices up.
4. Stablecoin perspective: The dilemma of the entire altcoin market
To understand WLFI, we need to zoom out to the entire market:
Stablecoin market cap growth vs Altcoin performance:
In the past 12 months, stablecoin market cap has grown by 65%
Theoretically, this influx of funds should drive altcoins up
But the reality is: Bitcoin has significantly outperformed altcoins
The total market cap of altcoins has dropped by 17% relative to Bitcoin
Why does this divergence occur?
The answer lies in: token unlocks and insiders selling.
5. Token unlocks: The invisible killer of altcoins
This is the most critical mechanism, and it is also what most people overlook:
Take APE as an example:
Circulation increased from 284 million to 940 million, over 3 times growth
Insiders continuously sell after obtaining new tokens
Price dropped from $0.30 to $0.02, a decline of over 90%
But the market cap change is minimal because the supply has increased
This is the trap of altcoins:
You see the market cap hasn't changed, thinking you haven't lost
But in reality, due to the increase in supply, the value of your holdings has significantly shrunk
Insiders cashing out on retail investors
My advice:
If you are optimistic about WLFI, you can wait for a rebound after favorable news is released
But in the long run, shorting may be a better choice
The key is to enter the market when sentiment is high and open interest is large
The story of WLFI is just a microcosm of the entire altcoin market. In the context of token unlocks and internal selling pressure, finding an altcoin that can rise 100 times is becoming increasingly difficult.
Of course, this requires expertise and strict risk control.
If you are also interested in on-chain data, feel free to follow.
