High FDV trend – low initial supply is a popular model in the crypto market in recent years. This can be described as the slowrug model of Ventures Coin. Many analysts have clearly warned that this model could destroy altcoins. However, the trend is likely to continue, but instead of avoiding them, how should we adapt to low float-high FDV projects? Because there are quite a few projects with low float-high FDV that have shown strong growth and good progress over each stage.
1. The impact of the Low Float - High FDV model?
The initial supply is low, and the token price can rise sharply during the initial listing period. This causes the FDV of those projects to reach high levels comparable to the top projects in the current market.
However, the high initial growth often comes at the cost of long-term decline. Raising funds through multiple rounds before public token release has given early investors high profit ratios. When their tokens are unlocked, they tend to sell, causing the price to drop. The greater the discrepancy between MC/FDV and the higher the FDV, the stronger the future selling pressure will be.
To better understand how Low Float - High FDV projects impact the crypto landscape in the long term, let's consider the following examples.
FF Falcon Finance
Falcon Finance (FF) is a typical example of the high FDV - low initial supply model with FDV ~800M USD while the market cap is only ~187M, circulating just ~23%.
The performance of FF over time is quite clear:
3-month performance: -37.7%
1-year performance: -83.6%
It is easy to see that since being listed on Binance, FF only experienced a slight initial growth followed by continuous decline due to prolonged selling pressure from unlock events and in the context of volume not being large enough to absorb the unlocked tokens, with the greatest risk falling on long-term holders.
Of course, the token price behavior is also influenced by many factors beyond FDV.
2. Reasonable investment strategies for projects with Low Float - High FDV models
2.1 Calculations and projections
Crypto projects often provide basic information such as: valuation, funding amounts, and tokenomics. If projects do not disclose this information, it serves as a 'warning' about risk levels.
For example, with Falcon Finance, the project raised funds at pre-valuation levels of ~$100M (Strategic/Strategic Investment) and ~$450M (ICM on Buildpad), while the total supply is 10 billion FF ⇒ the corresponding capital price of the fund is only about $0.01/FF and $0.045/FF, so when the token lists around $0.08 (FDV ~800M), early rounds have a significant price advantage, and as the supply gets gradually unlocked, selling even small portions can create enough pressure to cause prolonged price declines — fitting the model of high FDV, low initial supply, retail carrying unlocks.
Just a glance at the valuation and projected moves, we can basically understand the price behavior of low float - high FDV projects.
2.2 How to invest effectively?
No all-in, no blind holding: treat this as a trade opportunity by phases, avoid the long-term buy and hold mentality like in the old cycle, as unlock pressure often lasts long and erodes price over time.
• Prioritize early entry, exit before unlock: only participate when there is a clear catalyst (listing, incentive, ecosystem trends), and gradually exit before major unlock milestones, do not wait for large unlocks thinking that the price drop will rebound.
• Compare FDV with cash flow attraction: only consider if the project is genuinely strong enough to attract real buying power (users, fees, revenue, etc.) to absorb the newly unlocked supply; otherwise, high FDV is just a number on paper.
• Small position, disciplined profit-taking: divide capital into small amounts, set profit-taking goals in advance, accept thin profits — because in this model, the winners are usually those who exit early, not the most patient ones.
Conclusion.
Low float – high FDV is perhaps the most common model in the future of the crypto market, which will disadvantage long-term holders. However, it does not mean that any low float - high FDV project is uninvestable. Therefore, analyze carefully to adapt to any changes in the market.
#Token #FDV
