In recent days, the largest tokens in the TON ecosystem have seen a dramatic decrease in value, with some dropping by as much as 50% compared to their all-time highs. This downturn has affected prominent tokens including DOGS, Hamster Kombat, and Catizen, all of which have struggled since their listings. The Toncoin token has also faced challenges, suffering an over 8% drop in just one week.
Recent trading data indicates a worrying trend for the TON ecosystem. The total market capitalization of these tokens continues to fall, with trading volumes down more than 27%, now sitting at $675 million. This decrease in activity is reflected on platforms like Binance, where the ratio of buy to sell orders shows a mass exit from previously sought-after tokens.
DOGS Token Drops Over 58% Amid Community Trading Activity
Since its introduction on August 26, the DOGS token has plunged by over 58%, currently valued at $0.0006599. This token’s rapid decline is attributed to the absence of a vesting period, allowing users to sell their tokens immediately post-airdrop. In light of the recent price collapse, the DOGS development team has announced plans for a token burn, aimed at reducing supply and potentially stabilizing prices. The asset holders will vote on how many unclaimed coins should be removed from circulation.
Hamster Kombat Fails to Meet Expectations Following Airdrop
Similarly, the excitement surrounding the Hamster Kombat token has dwindled rapidly after the airdrop. Despite an initial surge, the active selling of HMSTR tokens resulted in a significant decline in value last week. The token was valued at $0.014 at launch but has since lost 50% of its worth.
Reports suggest that the disappointing performance stems from the airdrop process, which has been marred by complaints regarding the distribution of rewards and shifting timelines. Additionally, many participants found the financial returns for their efforts disappointing, leading to challenges in selling HMSTR tokens on exchanges due to restrictions on order openings.
Despite the token’s plummeting value, open interest in HMSTR Futures has remained steady at approximately $60 million since early October, suggesting continued interest among some investors.
CATI Faces Similar Challenges
The CATI token has also struggled, mirroring the trajectory of Hamster Kombat. Since September 20, CATI’s price has plummeted by 50%. Before the distribution began, the project team unexpectedly altered the token allocation, decreasing the percentage available to players from 43% to 30%. This decision sparked widespread dissatisfaction among community members, particularly when it was revealed that user spending, rather than time invested in the game, determined token distribution eligibility. Many players, despite high rankings, reported receiving minimal rewards, fueling a backlash characterized by the hashtag #catizenscam on social media.
Declining Airdrop Effectiveness
Airdrops, once a popular strategy to engage users, are losing their effectiveness in the TON ecosystem. Projects like Dogs, Hamster Kombat, and Catizen have heavily relied on these distributions to attract users, but this strategy is failing to sustain interest or maintain token value. A recent analysis of 62 airdrops across six blockchains revealed that 88.7% of the distributed tokens suffered significant price declines within 90 days, with only a few managing to maintain their value.
While smaller airdrops tend to experience less selling pressure initially, they too typically see value erosion over time. As Telegram-based games are still in their infancy, market sentiment regarding their long-term viability remains uncertain, contributing to increased selling pressure and further price drops.
Maartunn, a CryptoQuant analyst, noted that newly launched tokens within the TON ecosystem often experience a hype cycle characterized by initially high short-term expectations, which later decline as reality sets in. He also illustrated the transaction volume of Hamster Tokens relative to all TON transactions, highlighting the typical patterns associated with these hype cycles.
Ultimately, while some projects like Hamster Kombat show potential, Maartunn warns that many meme coins are unlikely to survive unless they possess strong fundamentals and a robust network.
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