23 out of the 50 biggest airdrops (46%) recorded peak token prices during the first 2 weeks of their airdrop date, the team at CoinGecko noted in a new report.
According to CoinGecko this suggests that the best time to sell airdrop tokens “may be within 14 days of receiving them, in order to take maximum profits.”
As mentioned in the update from CoinGecko, airdrop tokens “that reached their highest price returns in the short term include Ethereum Name Service (+73% by day 2 of trading), X2Y2 (121% by day 2), Blur (+90% by day 6), LooksRare (+192% by day 10), and ArbDoge AI (425% by day 14).”
As stated in a blog post from CoinGecko, “among the more recent airdrops, Jito (+43% by day 2), Wen (37% by day 3), Dymension (+75% by day 10), Manta (+72% by day 12), and Heroes of Mavia (+217% by day 13), were also most profitable for recipients if they sold shortly after the airdrop. That said, these airdrops have only been trading for several weeks, and it remains to be seen if their token prices will increase to new highs.”
The CoinGecko report further revealed that “out of these 23 airdrop tokens, 16 airdrops reached their peak gains between day 2 to 14 after the airdrop date.”
In other words, tokens tend “to enjoy a sharp spike in interest once they have been airdropped and start trading.”
According to CoinGecko, this confirms “that token airdrops are an effective marketing or growth tactic, but also indicates that interest in a specific token tends to grow following an airdrop as more people talk about it, reaching its peak shortly thereafter and is reflected in the token’s price.”
The remaining 7 airdrops saw prices peak “on the day of the airdrop itself, and token prices were subsequently unable to recover.”
For example, Solana aggregator Jupiter’s “airdropped token started trading around $0.66 but has since dipped by up to 28% and remained below its initial price.”
This scenario happens when the airdrop recipients rush to secure profits from their ‘free money’, resulting in “an immediate sell-off of the airdrop.”
These airdrops’ token prices have continued “to face selling pressure and record new lows, as recipients decide to exit their airdrop holdings over time.”
On the other hand, 27 airdrops “out of the 50 biggest airdrops reached their peak gains more than two weeks after its airdrop date, ranging from 15 days to 581 days. Such longer time frame price peaks typically align with favorable market conditions and the growth of the respective projects, which drove the airdrop tokens’ valuation beyond initial levels.”
The CoinGecko report further revealed that 19 of the 50 biggest airdrops “recorded all-time highs (ATHs) in 2021, amid the crypto bull market. All were launched either prior to or in 2021, which suggests that market conditions drove the higher valuations of these airdrop token prices.”
The CoinGecko report added that 4 out of these 19 tokens “hit ATH more than 100 days after their airdrop.”
These airdrop tokens “are Uniswap (1,145%), 1inch (216%), Gitcoin (242%), and Bank (94%).”
These tokens achieved significantly higher returns “at their ATH prices compared to their short-term peaks.”
For example, Uniswap’s ATH price return of 1,145% “is 10 times more than its highest price returns during the first 14 days of trading, which is 106%.”
These suggest that for certain airdrops, recipients can “consider holding onto their airdrop allocations for value accrual over a longer period of time, in order to make higher profits during favorable market conditions.”
11 out of the 50 airdrop tokens hit their ATHs “in 2022, at a time of relatively bearish market conditions.”
However, early in 2022, there was “a bull market for non-fungible tokens (NFTs), which helped push the valuations of 3 out of these 11 airdrop tokens (ApeCoin, LooksRare, and X2Y2) to new ATHs.”
On the other hand, the other airdrop tokens “that hit their ATHs in 2022 were launched in the same year and hit their ATHs shortly after their airdrop date.”
The exception was Osmosis, which “launched in June 2021 but hit its ATH in 2022.”
This suggests that during a bear market, the best time “to sell airdrop tokens is right after the airdrop, in order to maximize profits.”
The remaining 21 out of 50 airdrop tokens hit their ATHs “in 2023 and 2024, with bullish sentiment returning due to the approval of spot Bitcoin ETFs in the US.”
8 out of these 21 airdrop tokens hit “their ATHs more than 100 days after their airdrop.”
These airdrop tokens “are Arbitrum (68%), Bonk (28,091%), Celestia (777%), Optimism (186%), Aptos (34%), WorldCoin (249%), Arkham (67%), and Maverick (38%).”
Another 5 airdrops took 15 to 100 days “before reaching their peak token prices, while the remaining 8 airdrop tokens hit their ATHs within 14 days of the airdrop date. (Note that among the 8 tokens which peaked within 14 days, 5 are recent airdrops: Manta, Jupiter, Dymension, Heroes of Mavia, and Wen).”
This suggests a shift in market sentiment in 2024, “such that it might be more profitable to hold onto airdrop tokens as they reach new valuations in the anticipated bull market.”
When to Sell:
Number of days, weeks or years taken “for the 50 biggest airdrops to reach their all-time high token price, and their corresponding percentage price returns at the peak, as of February 20, 2024.”
Methodology
This study analyzed the days taken “for the top airdrops to achieve their peak returns, from January 1, 2020 to February 20, 2024.”
Price data was collected from CoinGecko.
Short-term peak gains refer to highest price returns “in the first 14 days following the airdrop.”