Founded in 2022 as a spin-off from SwissBorg, XBorg is focused on revolutionizing the gaming industry through its player ID protocol that enhances online experiences by enabling data ownership.
In this interview, Connor Kirsten, Head of Growth and Marketing at XBorg, elaborates on the challenges surrounding the token's 2024 launch, attributing the poor performance to market saturation and the negative impact of overvalued projects. He highlights that high valuations and declining circulation are scaring off new buyers, causing prolonged selling pressure and a gradual decline in prices.
Kirsten criticizes the role of centralized exchanges and market makers, arguing that strict listing requirements and disproportionate control over token supply increase selling pressure and erode community trust. He proposes a more sustainable approach to token issuance, arguing for lower valuations and shorter vesting periods to attract committed investors and foster long-term growth.
Launched in August 2024, XBG token's unique strategy rejects the traditional centralized exchange route in favor of a fully on-chain launch with 100% investor unlock, aiming to empower the community and reduce future selling pressure. XBorg believes that this approach, if successful, could set a new trend in token launches and provide projects with an additional option to engage with their communities and strengthen their fundamentals.
After the launch, XBG dropped from $0.15 to $0.05 before recovering to around $0.08. Xborg CEO Luis Regis commented that only 13% of the tokens sold after the TGE were sold.
Can you give us a brief background on XBorg?
The company was founded in 2022 as a spin-off from SwissBorg and is building a player identity protocol to drive the evolution of online experiences. We aim to revolutionize the gaming industry by empowering players to own and use their data, enabling a more personalized internet.
Why do you think the majority of tokens launched in 2024 performed poorly?
There are more tokens to choose from in 2024 than there were in 2021, but that doesn't necessarily mean there will be more capital. This means that as a new token, it becomes harder to gain attention and attract capital. Another reason for poor token launches in 2024 may be that several overvalued projects launched early in the year after big SocialFi campaigns. These campaigns attract a lot of attention and usually airdrop significant amounts of token supply to farmers who finish at launch, lowering the token price.
Is the low float high FDV meta deterring new buyers?
New tokens are launched at high prices with low circulation, which means that unlocking these tokens takes years, which may discourage new buyers from buying new tokens. As a result, most new tokens are subject to selling pressure at launch, which increases a little with each unlock. Without marginal buyers, these tokens will slowly go to zero, discouraging investors from buying new tokens.
Is the requirement to list on a top CEX negatively impacting the industry?
We believe so. Too many tokens hoping to launch in Q1 2024 distorted the power dynamics between major centralized exchanges and upcoming projects. This resulted in unrealistic requirements and led teams to do whatever it takes to get listed on a top exchange. In most cases, this came at the expense of larger listings, damaging communities, early investors, or finances, which in turn negatively impacted the industry as a whole.
Do market makers and CEXs apply unnecessary selling pressure?
To list on a top centralized exchange, projects are typically asked to do an IDO at a significantly lower valuation than the listing price, usually less than a tenth of the price. These IDO tokens are fully unlocked at launch. Additionally, exchanges and market makers require a percentage of the project's token supply for themselves. However, projects are required to have no more than 5% circulating supply at launch. Therefore, most of the tokens in circulation at launch are held by market makers, exchanges, and IDO participants. Projects' communities only get a small amount of unlocking, which has negatively impacted most token launches in 2024.
Are meme coins a good case study for utility/infrastructure projects?
When something as successful as Memecoin has been, there is surely something to learn from it. Memecoins have shown that launching with high circulation, no future token unlocks, and a strong community is the secret to success. If a utility project can add strong fundamentals to this mix, the possibilities are endless.
Is there a more sustainable way to launch a token?
We believe that lowering valuations and reducing vesting is much healthier for the token in the mid to long term. It allows non-believers to sell early and allows new buyers to secure their positions without fear of a long unlock schedule. It also allows the token price to rise as the project grows, making the token more useful.
Why is XBorg's approach unique?
Our approach is particularly unique in a few ways. First, we proposed an innovative launch strategy to the community, and they decided on it by voting. Additionally, it is not common for large projects to buck the industry trend and try something new. Rejecting the centralized exchange route and launching on-chain with full investor unlocking is quite alien to new token launches these days.
Why involve the community in launch strategy decisions?
One of the utilities of the XBG token is governance. We have hosted 15 XBorg improvement proposals to date, all involving major ecosystem decisions. We are actively building XBorg together with our holders, and believe that holders should make decisions on topics related to their investments.
XBG was released on August 19th, how do you feel about its performance so far?
It's still too early to tell. There was a lot of selling pressure on the first day, but that was to be expected given that investor unlock was 100%. The price then recovered sharply as new buyers bought XBG at bargain prices and is now pretty stable around $65M FDV and $14M market cap. Presale investors are down 20-30% at the current price, so we're not happy about this and will do everything in our power for them. We believe we can build strong momentum from here, as minimal future unlocking and large circulating supply give us a huge competitive advantage over other new tokens.
Do you think this could be a new meta for token launches?
If XBG performs well in the coming months, I think more projects will try this strategy. However, you need to be confident in the strength and foundation of your community to unlock investor tokens. We hope to be a success story of this strategy in the future. I think more recent projects need additional launch options.
What should someone who is interested in this strategy, XBG or XBorg do?
Reach out to us on X or Discord and we'll be happy to offer insight and advice on what worked well and what we could have done better. If you're interested in XBG or XBorg, do your research and check out our website, social media and write papers to find out more and join our community. We're looking for people who want to innovate and contribute to a cause bigger than themselves.
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