The former richest Chinese person still experiences a big dump of 20%! Unveiling the three fatal reasons for ASTER's collapse under CZ's endorsement.

Despite receiving public support from former Chinese billionaire CZ, the native token ASTER of the perpetual decentralized exchange Aster has plummeted over 20% in just a few days, falling from a high of $2.43 on September 24 to $1.23 on September 29. This astonishing decline has drawn widespread attention in the market, with investors questioning why a star project backed by the "first person in Chinese encryption" is facing such a severe market dumping. This article delves into the three key factors behind the price drop of ASTER.

Poor product experience: the main driver of user loss

(Source: CoinMarketCap)

The primary reason for the fall in ASTER prices comes from users' disappointment with the actual experience on the platform. Several well-known investors have publicly stated that they have reduced their holdings or completely dumped ASTER tokens in favor of investing in other assets.

Investor Mike Ess revealed on social platform X (formerly Twitter) that he has sold 60% of his Aster holdings, reallocating the funds to Bitcoin (BTC) and Plasma (XPL). Although still in profit, Ess admitted that this decision was primarily based on dissatisfaction with the product quality:

"If you have used HYPE and then switched to Aster, you will understand what I mean. It feels slow, not refined enough, more like an imitator... The more capital invested, the greater the risk I feel."

This kind of disappointment with the product experience is not an isolated case. Another well-known analyst, Clemente, has directly announced that he has liquidated all ASTER Tokens and is now fully supporting the competitor Hyperliquid's HYPE Token. He candidly stated, "Aside from criminal activity and CEX distribution, Hyperliquid is clearly ahead in all metrics."

CZ's Ambiguous Stance: Investor Confidence Shaken

The second key factor is that CZ's attitude towards Aster has released mixed signals, leading to a shake in investor confidence.

On September 28, CZ publicly positioned Aster as a "complementary project to the CEX public chain ecosystem," which has raised doubts in the market. On one hand, CZ's investment company YZi Labs (formerly CEX Labs) does hold a minority stake in Aster, and there are several former CEX employees on the Aster team; on the other hand, Aster, as a decentralized exchange, is essentially in direct competition with CEX.

Investors like Mike Ess interpreted CZ's cautious wording in the recent Spaces voice meeting as a "sign of detachment," raising questions about the actual level of support from CZ. Ess even directly warned: "If CZ stops talking about this, HYPE will easily win."

For an emerging project that largely relies on the celebrity effect of its founder, this ambiguous stance undoubtedly increases market uncertainty, prompting some investors to choose to reduce their risk exposure.

Competitive pressure and market expectations are too high

(Source: DefiLlama)

The third factor leading to the fall in ASTER prices is the immense pressure from competitors, particularly the strong performance of Hyperliquid's HYPE Token, which may have raised market expectations for Aster too high.

Since its launch, Aster has indeed achieved some impressive results:

· Generated over 82 million dollars in transaction fees

· The total locked value (TVL) on the CEX public chain has increased to 701 million USD.

However, these data still seem lackluster compared to investors' extremely high expectations for "CZ-backed projects." Market analysts point out that Aster's initial valuation may have already incorporated too much optimistic expectation, leading to any performance below expectations potentially triggering a significant adjustment.

At the same time, Hyperliquid, as a strong competitor in the perpetual DEX market, has continued to receive positive feedback from users regarding its product experience and market performance, further intensifying the competitive pressure on Aster. A crypto analyst who wished to remain anonymous stated: "The perpetual DEX market may not be a winner-takes-all, but it is also unlikely to support too many players at the same time. Aster needs to quickly improve its product experience to maintain competitiveness."

Market Divergence and Future Outlook

Despite the price fall, Aster still has a loyal group of supporters. User Cooker stated that he believes Aster will leave a lasting mark in the DEX market. Another investor, Crash, predicts that in the next market cycle, Aster's percentage performance may outperform Solana and Ethereum.

However, whether this optimistic sentiment can translate into a price rebound largely depends on whether the Aster team can resolve the current product issues and whether CZ will provide clearer support signals.

Analysts warn that if Aster cannot significantly improve user experience and clearly position its relationship with CEX and its public chain ecosystem in the short term, the ASTER Token may face further downward pressure.

For investors, this case once again demonstrates that even projects with strong backing ultimately depend on product quality and market acceptance for their success. In the rapidly changing field of cryptocurrency, celebrity effects may bring short-term hype, but long-term value must be built on practical applications and user experience.