The Performance of Airdropped Tokens Analyzed 📈
On July 8, pseudonymous crypto analyst Aylo shared a comprehensive analysis on the social media platform X, examining the performance of tokens launched through airdrops.
Key Findings on Airdropped Tokens 🧐
Aylo’s curiosity led to an analysis of the top 500 tokens by market capitalization, comparing their current prices to their launch prices. Here are the key findings:
- 23 out of 31 tokens have declined in value since their launch, with significant drops.
- Only four tokens have outperformed Bitcoin (BTC) since their launch.
- One outperforming token was launched in 2024.
- Successful meme-related airdrops include BONK and DEGEN.
- TIA is also performing well above its launch price.
Optimal Strategy for Airdropped Tokens 💡
Aylo’s analysis suggests that selling airdrops on launch day and converting them into USD or BTC is generally the best strategy. Here’s why:
- Initial price increase post-launch may be possible, but holding airdropped tokens tends to result in poorer performance.
- Exceptions exist, but holding the right airdrop is challenging, especially compared to BTC.
- For bullish investors, buying at lower prices than on launch day may yield better results.
Reasons Behind Token Value Decline 📉
Aylo points out that airdrops are not the sole reason for token value decline. Here are some observations:
- Projects often set valuations too high with the help of market makers.
- Dumping of airdropped tokens quickly reveals inflated valuations.
- Many participants are learning the importance of Fully Diluted Valuation (FDV).
Challenges and Opportunities for Airdropped Tokens 🌟
Despite the challenges, Aylo suggests that there are opportunities for airdropped tokens. Here’s what he found:
- Yield farmers typically sell regardless of price to extract yield.
- Poorly designed airdrops can have detrimental short- and medium-term impacts.
- Two surprise meme coin airdrops, BONK and DEGEN, have performed well due to low initial valuations.
Future Outlook for Airdrop Tokens 🔮
Aylo warns against assuming all meme airdrops will perform well and suggests that points programs may persist. Here are some insights:
- Success of airdrops like BONK and DEGEN may be attributed to surprise nature and low initial valuations.
- Expectations for airdrops to continue in their current form are low.
Recommendations for Crypto Projects 🚀
In conclusion, Aylo advises crypto projects to carefully consider the form of their airdrops if they choose to conduct one.
Hot Take: Airdrop Insights and Strategy 🌶️
Reflecting on Aylo’s analysis, it’s clear that airdropped tokens pose unique challenges and opportunities for investors. Understanding the optimal strategies and potential pitfalls can help navigate the complex world of airdrops in the crypto space.
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