The founder of OKX raises red flags.

Star Xu, the founder of major crypto exchange OKX, warns that newly listed altcoins are frequently sold.

In particular, it points to a severe fall of the Aevo token, which fell from $4 to $0.434 in March 2024. This represents an impressive 90% reduction in five months.

Aevo has announced a buyback to create long-term value for token holders

Xu's critique extends beyond market volatility to address the ethical responsibilities of crypto exchanges.

In a post on X (Twitter), Xu questioned the motivation behind crypto exchanges listing new tokens. These actions often lead to quick sales, primarily benefiting the original owners and harming the broader user base.

“Currently there is no control over listing and delisting, so how can we protect this market? This is something the entire industry should reflect on,” Star Shu said.

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Echoing Xu's concerns, prominent crypto investor Ramenpanda has announced a change in how project developers approach token sales. In the past, founders have invested heavily in their own cryptocurrencies. However, today's developers frequently use tokens only as a tool to collect and cash out dollars.

“Tokens themselves have become an intermediary instrument for issuing US dollars. These project developers don't believe in Bitcoin, let alone their own tokens.” RamenPanda criticized altcoin developers.

Moreover, in response to these issues, the Aevo Group implemented a token purchase strategy to stabilize the price. In July, they bought 1 million AEVO at an average of $0.446.

“We promise to buy back at least 1 million AEVO every month from July to December. AEVO's supply is almost fully issued and we believe this is a good starting point for long-term value creation for AEVO token holders, the team announced.

However, Evo is not the only one facing these challenges. Recent data from VC publisher Dune Dashboard suggests that several altcoins are under similar pressures. For example, venture capitalists (VCs) owning Etena (ENA) are sitting on unrealized gains of 73X, which would create significant market impact if these gains materialized.

Additionally, token-opening events contribute to market pressures. Wormhole's upcoming release of 600 million W tokens, which is 33% of its circulating supply, is expected to introduce a significant sales force to the market.

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Similarly, last week AltLayer launched over $100 million worth of ALT tokens. These tokens account for 42% of the supply. If stakeholders sell their tokens on the open market, it can create pressure, affecting the price.