Five days later. What will happen to the Arbitrum token after the Airdrop
ENCRY Foundation and Exmo. me experts told about the prospects of the Arbitrum project token after the airdrop
Experts evaluated the effectiveness of token distribution for the project and told how the ARB token exchange rate may behave in the future
After the sensational Arbitrum airdrop (March 23), 1 billion ARB tokens were issued and distributed among 625,000 addresses. The total market capitalization of the token stabilized at $1.44 billion.
At the time of publication, the price of ARB is $1.14. Having analyzed the experience of projects such as Optimism, Aptos, and Blur, whose tokens have also entered the market as part of the large-scale airdrop
Once listed on exchanges, tokens of projects with airdrop tend to exhibit high volatility - there can be both sharp price spikes and drawdowns of dozens of percent at a time, the co-founder of ENCRY Foundation commented. In general, ARB corresponds to "the most positive pattern": the token price did not collapse after the start of trading on exchanges Bybit, Kucoin, MXC, Huobi, Okex, and then on Binance, though it experienced serious fluctuations. On Huobi, the exchange rate was as high as $11 per token on the day of listing, though the price went down almost immediately.
First of all, such volatility is due to the fact that those who received ARB tokens during the Airdrop decided to take profit after the listing, which had a pressing effect on the rate. On the other hand, a significant number of sell orders were placed well above the market price, pushing the rate higher.
"Now the price is entrenched just above $1, I see the possibility of a drawdown to $1, but I also see from the exchange stacks that there is a wall of ARB buys orders around $0.9-1, so I wouldn't expect a strong drop below $1. In general, $1 is a suitable level to enter the asset for those who consider it for the mid-and long term," says the expert.
If compare ARB occurrence on exchanges with other big tokens with airdrop, the similarity is traced in high volatility at the beginning of trades, Nekrasov notes. The main difference is the "general bullish sentiment" of investors towards ARB, supported by data such as the Arbitrum network's total value locked (TVL) growth by a quarter over the last week. According to DefiLlama, Arbitrum's TVL stands at $2.18 billion, while its closest competitor, Optimism, has $907 million of locked-in capital in its ecosystem.
Arbitrum and other projects that have arranged token giveaways do have similar exit patterns, agrees the head of Exmo. me. The price graphs are similar, he says: a price spike and then a corrective movement. In such cases, it is best to wait for price levels to form on long timeframes and then try to trade. If the trader plans short-term transactions, it is necessary to observe the standard measures of risk management, the expert advises.
The beginning of ARB trading was marked by the fact that at some exchanges trading started a little later than it was announced, and the influx of users led to disruptions in the resources for obtaining tokens and exchanges. The appearance of tokens on exchanges was immediately accompanied by high trading volumes, which further attracted crypto traders. This gives big players an opportunity to form positions without much damage to the average purchase price
In his opinion, it is difficult to predict the further development of ARB price, as price levels have not yet been fully formed. In the short-term prospects it is necessary to pay special attention to the level of $1 because it will act as psychological support, the head of Exmo. me notes. In case of a positive scenario, we should be careful at $1.5. If this resistance is broken through, the price could very likely quickly approach $2.
"A great marketing move."
The effectiveness of Airdrop directly depends on the marketing work that the project has done before distributing the tokens, explains Roman Nekrasov, discussing how effective Airdrop was for Arbitrum. First, the project needs to develop the community and raise new capital, constantly hinting at the possibility of a profitable airdrop for active participants. Under such conditions, you can talk about success - even if some of the users in the community decide to sell ARB tokens, interest in the new asset will remain.
The effectiveness of such a model is good for the popularity of the project - it's an excellent marketing move, adds Cherpichnikov. In the case of Arbitrum, popular thematic media "literally exploded with the news." People like to get something for free, especially if it will bring good profits in the future, the expert notes, while specifying that there is a high probability of asset sales by participants after tokens are distributed.
"You shouldn't think in extremes. Most traders will fix some part of the received tokens, for example, 20-30%. The rest will go into stacking or long-term storage waiting for price growth if the project really deserves it," explains Cherpichnikov. According to his observations, we can already see that large participants in the crypto market are actively accumulating ARB in their wallets.
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