Airdrops are used by projects to increase visibility, but their long-term value depends on the project's fundamentals. Strong projects with real-world utility tend to retain value, while others may experience a drop in price once the initial hype fades. It’s crucial to assess the project's sustainability.
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A "rug pull" refers to a type of scam in decentralized finance (DeFi) where developers create a seemingly legitimate project, attract investors, and then suddenly withdraw all of the liquidity or funds from the pool, leaving investors with worthless tokens. This typically happens in projects with little transparency, no auditing, and a lack of community involvement. To protect themselves, investors should conduct thorough research (e.g., check if the smart contract has been audited, review the team's background, and gauge community trust). It’s also important to avoid projects with anonymous developers or unclear tokenomics. Lastly, using reputable platforms with a history of security can help mitigate the risk of falling victim to a rug pull.
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Large buy orders at key support levels can act as price floors, signaling strong demand and preventing the price from falling below certain points. Similarly, large sell orders near resistance levels create price ceilings, making it harder for the price to rise. When these large orders are absorbed or removed, it can indicate a potential breakout or breakdown. If buy orders are being filled, prices may move higher, while if sell orders get filled, prices could fall. Traders monitor the order book to identify key levels where price movements might accelerate, giving them a competitive advantage.
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