The rise of airdops and its impact on the cryptocurrency market market
In recent years, Airdops has become a popular phenomenon among cryptocurrency enthusiasts. These offers are often administered by blockchain projects or organizations to distribute part of your token supply to users. In this article, we will explore the role of Airdops in the formation of market capitalization, with a case study on Ethereum (ETH).
What is an airdop?
An aircrop is a promotional event in which a cryptocurrency project distributes tokens to its users without demanding any specific action or participation. This may include giving a fixed percentage of tokens at launch or offering bonus currencies to initial adopters or faithful users.
The concept of market capitalization (MC)
Market capitalization represents the total value of the shares in circulation of a company. In the context of cryptocurrency markets, it is often calculated as the sum of all the participation of pending token holders. The price of these tokens can float based on market demand and supply.
Airdrops and Market Cap
When an aircrop occurs, it injects new money into the market, which can increase the overall value of cryptocurrencies. By distributing tokens to users who have not participated in the project, Airdrops creates a perceived increase in the demand for currencies.
This phenomenon was observed in several cases:
* Ethereum (ETH) : During its initial offer of currencies (OIC) and the subsequent release of Mainnet, Ethereum suffered a significant price appreciation. This occurred largely due to the aircrops administered by the project developers and the first adopters.
* Cardano (ADA) : Cardano benefited from an aircrop during its Oic, which led to a substantial increase in market capitalization.
CASE STUDY: ETHERUM (ETH) AIRROP
In 2016, Ethereum conducted a successful success event, distributing approximately 60 million eths tokens. This was followed by the launch of the Ethereum 2.0 main network, which marked a significant milestone for the project.
Airdrop played a crucial role in increasing market capitalization and boosting the overall value of Ethereum. According to coinmarketcap data, the price of ETH increased from $ 113 per token on December 1, 2016, to about $ 700 per token on December 31, 2020.
Conclusion
Airdrops has proven to be an effective tool for increasing market capitalization and increasing cryptocurrency prices. By distributing tokens to users who have not participated in the project, Airdrops can create a perceived increase in demand and increase the price of participating currencies.
As the encryption market continues to evolve, it is likely that we will see more Airdop events and its impact on market capitalization. Although some may see Airdrops as a way to circumvent regulatory requirements or manipulate market feeling, they can also be seen as a legitimate form of fundraising and promotion.
Recommendations
* Understand the concept of market capitalization : To fully appreciate the role of aircrops in the formation of market value, it is essential to understand the fundamental principles of cryptocurrency markets.
* Keep informed about the next events : Follow news and advertisements for projects that may be managing Airdop events in the future.
* Be cautious with Airdrop Hype
: Although Airdops can create significant price movements, they should not be considered a primary investment strategy.
As cryptocurrency markets continue to grow and evolve, it is essential to stay informed about the role of Airdops in the formation of market value. Understanding the concept of aircrops and its impact on market capitalization, individuals can make more informed decisions when investing in cryptocurrencies.