Jupiter (JUP) has become a hot topic in the market due to its large community, but many CEX investors and newcomers have not paid attention to the upcoming massive token airdrop release. Over time, more and more signs indicate that this event will not push JUP's price up, but may instead trigger severe market selling pressure and price crashes. For participants, this may be a crisis that requires extreme caution, rather than an opportunity.
Core risks of airdrop releases
1. Massive releases lead to severe supply-demand imbalance
Current circulation: 1.3 billion (of which 400 million are staked on-chain)
Airdrop: 1 billion (700 million planned airdrop + 300 million ASR rewards)
Among them, ASR rewards annualized: 90%
So this coin's CEX traders are no match for the seasoned DEX players.
The total airdrop amount for Jupiter is huge, and most of these tokens are distributed to early participants, project team members, and speculators. These individuals often have 'arbitrage' as their main goal, and their strategy is very simple: sell immediately after the tokens are unlocked to lock in profits.
Once a large number of tokens flood into the market simultaneously, the market will quickly fall into a situation of oversupply, and buy orders simply cannot absorb such large selling pressure, directly causing a price collapse. This phenomenon is common in the crypto market, and many projects experience price drops of 70%-90% during the release period.
2. Airdrop participants have very low costs and strong selling motivation
Most airdrop recipients have token costs close to zero, and this 'no-cost arbitrage' is the main reason for the price crash during the airdrop release period.
Some recipients lack the motivation to hold long-term; they only care about quick cashing out.
Everyone hopes to sell off before others to avoid further price declines, which can create a stampede effect, further accelerating the speed and extent of the price crash.
3. JUP market confidence is gradually weakening.
Before the massive airdrop release, the price of JUP has already shown signs of weakness. Many speculators have already entered the market, trying to drive up the price for profit before the airdrop, and once the airdrop tokens are unlocked, these speculators will also begin unloading, creating a 'double selling pressure'.
What's even scarier is that there are very few true long-term value investors in the market, and the funds for buying back are clearly insufficient, which will make it difficult for JUP's price to stabilize.
The painful lessons from past airdrop projects
Price crash of Aptos (APT) after the airdrop
Aptos faced a massive sell-off pressure from users after the airdrop release, with prices plummeting over 50% in just a few days. Many early recipients of the airdrop cashed out directly, leading to a rapid collapse of market confidence. Although there was a rebound later, the short-term crash caused heavy losses for countless buyers.
Optimism (OP) airdrop crash
Optimism was once a highly regarded Layer 2 project in the market, but after the massive airdrop release, the OP token price plummeted from $1.7 to $0.5, a decline of over 70%. Almost all users who participated in the airdrop chose to sell.
Key risks that market participants should be aware of
1. The risk of high-position buying is extremely high
Before the airdrop release, many institutions and individual investors may artificially drive up the price to create an 'upward illusion' to attract retail investors to chase high. However, once the airdrop is unlocked, all chips will crash down on retail investors who chased the highs, leading to severe losses.
2. Short-term crashes are difficult to avoid
Even if you believe Jupiter has long-term potential, the price crash caused by airdrop releases in the short term is almost inevitable. You might buy tokens that seem 'cheap', but before the selling pressure dissipates, the price is likely to drop further, trapping you in the dilemma of 'buying the dip at halfway down'.
3. The possibility of liquidity collapse
Airdrop releases are often accompanied by a surge in trading volume, but as selling pressure increases, market liquidity can quickly dry up. When buy orders are insufficient, prices will fall faster, making it difficult for you to close your position.
How to cope with the airdrop release period?
1. Avoid blindly chasing highs
Price fluctuations before and after the airdrop release are enormous, and many early investors have already positioned themselves, making it easy for retail investors to get 'cut'. It's better to miss out than to risk buying in.
2. Pay close attention to release ratios and timelines
Understand the release rules of the JUP airdrop; if the release ratio is high and the concentration is large, the market selling pressure may be more severe. Be cautious in holding positions before the unlocking period ends.
3. ASR stakers should use leveraged trading for hedging (shorting at low multiples)
During the airdrop release period, the market is prone to crashes, but with 450 million JUP locked in staking periods, risk management should be timely to lock in profits.
Treat airdrops rationally, don't become a bag holder!
The Jupiter airdrop release may be a means for the project team to attract users, but for ordinary investors, it often means bloody sell-offs and price crashes. The large drops during the airdrop release period have become a 'norm' in the crypto market, and all participants should remain vigilant to avoid being the ones getting 'cut' in the speculative wave.
Remember: there's no free lunch in the crypto market, the so-called 'airdrop feast' may just be a carefully designed harvesting scheme. Stay away from the risk of a crash and protect your funds!