Optimism (OP) launches an airdrop of its governance token and it fails

On the occasion of the launch of its governance token, Optimism (OP) chose to make an airdrop aimed at its community. However, the media coverage of this event seems to have been counterproductive since it generated high demand, thus leading to network congestion. Moreover, in the aftermath, some recipients rushed to sell the crypto-assets they received. All this led to a drop of more than 60% in the price of said token in less than an hour.

Optimism distributes tokens for free

Earlier this week, Optimism, the scaling solution for layer 2 based on Ethereum (ETH), has started the free distribution of its governance tokens. In fact, Optimism affected 5% of its overall OP token supply – roughly 215 million tokens – to this first airdrop. And 14% of its total supply is reserved for future airdrops.

To be eligible, addresses must meet certain criteria, namely:

  • have used the Optimism Network at the start of the mainnet launch (before June 23, 2021)
  • have made at least one transaction with Optimism in the last month
  • consent to participate in the votes of the Decentralized Autonomous Organization (DAO)
  • be a signatory of a multi-sig having carried out at least 10 transactions
  • have already been eligible for an Optimism airdrop
  • be a Gitcoin donor

For information, addresses that meet several of these conditions will benefit from additional bonuses.

Optimism victim of its own success

Long-awaited, this airdrop aroused a lot of dissatisfaction on the part of the participants. In fact, some aspirants managed to claim their tokens before the official distribution launch by interacting with the smart contract.

“Our biggest mistake here was not putting this contract on hold. The claims were open, and we had no way to stop them,” Optimism said.

Moreover, Optimism also admitted that it had greatly underestimated the traffic that would go to its claim interface.

In fact, the delay in the claim was due to the heavy traffic on the public Optimism CPP. This is the gateway allowing applications to connect to the blockchain.

The return to normal on the network took 5 hours. During this time, the project team removed the initial complaint interface in order to redeploy a more scalable one.

In sum, 248,699 addresses were eligible for this airdrop program. Currently, 127,421 addresses have already come forward. However, over 140 million OP tokens have already been distributed, representing 65.55% of the allocated tokens for this airdrop.

A governance token under threat

After receiving their OP tokens, recipients immediately cleared their rewards. This behavior resulted in depreciation of the token. In less than an hour, it fell to $1.46, losing 67.5% of its value from its initial price of $4.5.

In reaction to this dumping, a member of the Optimism community submitted a proposal aimed at excluding these people from future airdrops. On the other hand, some critics have questioned the relevance of this token.

Optimism has a lot to learn from this airdrop. It highlighted a deficit in terms of preparation and anticipation. It also highlighted the lack of optimism some people have about the future of the project token. Anyway, the OP token is currently listed on several exchanges, including Binance, Huobi, Kucoin, Coinbase, etc. At the time of writing, the OP token is trading at $1.34 after hitting as low as $0.79.

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Optimism (OP) launches an airdrop of its governance token and it fails

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