Pre-launch volatility underscores the critical role of liquidity in stabilizing markets, according to the report.Pre-launch token trading is a growing trend among cryptocurrency investors, despite introducing up to 20 times the price volatility of post-token launch trading.
Similarly, the Jupiter token's volatility rose to around 2,800% pre-launch, falling to around 150% one week after launch, according to a Keyrock report shared with Cointelegraph.Understanding how market liquidity is affecting a token’s volatility could help traders take more calculated risks, according to the Keyrock report.
Due to the lack of liquidity in pre-launch markets, the price discovery phase of pre-TGE tokens has disappeared. In finance, price discovery refers to the period when an asset’s price is organically determined through the buyers and sellers.Despite the lack of liquidity and volatility, pre-TGE trading remains a growing trend amid more risk-taking investors aiming to be the first to gain exposure to new crypto projects in the hope of higher returns.
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