Surprisingly, the alpaca marking soared more than 650% within just a few days after Binance announced it would postpone the assets. In the case of a brief squeeze and a temporary suspension of new token issuance, the rally violates typical market expectations.
Alpaca Price Action: Short Squeeze and Token Issuance Pause
On April 24, 2025, Binance (the world’s largest exchange announced that it will combine all spot trading pairs involving alpacas on May 2, 2025. However, the price movement of alpacas violated expectations.
TradingView data shows that alpacas rose from $0.029 to a peak of $0.21 in 48 hours. Trading volumes also soared, indicating a surge in investor participation.
However, by April 29, the trend reversed sharply. In just three hours, alpaca wool plummeted 70%, down from $0.24 to a low of $0.066, eliminating most of its previous gains and raising concerns about the sustainability of the rally.
Source: binance
The sudden price surge was largely attributed to a “short-term squeeze.” After the announcement, many traders opened short-term positions, with alpacas expected to fall.
However, when prices rise unexpectedly, these short positions are forced to cover up, buy back tokens to avoid further losses, increasing purchase pressure and increasing prices higher.
Another major factor is the decision of Alpaca Finance Corporation to suspend its plan to issue other alpaca tokens. According to the team, the project was originally intended to provide more liquidity for market makers. However, the team canceled the plan after receiving negative community feedback. This indirection tightens the token supply and further drives upward price momentum.
Lessons from voxel cases
The situation with alpacas is not the only one. Previously, after the news broke out, voxel tokens also immediately experienced a sharp pump. But the voxel situation is even more complicated, as Bitget found a group of actors who manipulate the market and made illicit profits of more than $20 million. Bitget issued eight legal notices, freezing assets in related accounts and pledging to redistribute 100% of the recovered funds to users through AirDrops.
Although alpacas have shown impressive short-term growth recently, investors’ risks remain high. Over the next period, this option will greatly reduce the liquidity of the alpaca, making buying and selling tokens more difficult.
Binance will continue to trade for Alpaca/USDT, Alpaca/BTC, Alpaca/BNB and Alpaca/BUSD recommendations starting from May 2, 2025 at 03:00 UTC.
Read more: Shocking Breakthrough from Voting to Delist Project Voxel
in conclusion
Alpaca attacks emphasize the potential for rapid growth in distress tokens and are inherent dangers in chasing short-term pumps. While the project temporarily benefits from suspension of token issuance and forced short-term coverage, the upcoming recommendations may lead to thin liquidity and instability in price.
