原文标题：Airdrops in the Barren Desert: Surveying the traits behind 2024’s 11% success rate

Author: Keyrock

Compiled by: Scof, ChainCatcher

Key Takeaways:

  • Unsustainable

Most airdrops collapsed within 15 days. In 2024, despite an initial price surge, 88% of tokens lost value within a few months.

  • Big ups and downs

Airdrops distributing more than 10% of total supply have seen stronger community retention and performance. Those below 5% have typically faced a quick sell-off following release.

  • High FDV

A project is most hurt by a high fully diluted valuation (FDV). A high FDV inhibits growth and liquidity, leading to a sharp drop in price after an airdrop.

  • Liquidity is crucial

Without enough liquidity to support high FDV, many tokens collapsed under selling pressure. Deep liquidity is key to price stability after an airdrop.

  • A tough year

Cryptocurrencies struggled in 2024, with most airdrops being hit the hardest. For the few that succeeded, smart allocation, strong liquidity, and realistic FDV were their strategies.

Airdrops: The Double-Edged Sword of Token Distribution

Since 2017, airdrops have been a popular token distribution strategy used to create early hype. However, in 2024, many projects have struggled to succeed due to oversaturation. While airdrops still generate initial excitement, most result in short-term selling pressure, which leads to low community retention and protocol abandonment. Nonetheless, a few standout projects have managed to break this trend, proving that with the right execution, airdrops can still lead to meaningful long-term success.

Purpose

This report attempts to unravel the mystery of the airdrop phenomenon in 2024 — differentiating the winners from the losers. We analyzed 62 airdrops across 6 chains, comparing their performance across several dimensions: price action, user adoption, and long-term sustainability. While each protocol has its own unique variables, the collective data paints a clear picture of how effective these airdrops were in achieving their intended goals.

Common manifestations

When examining the overall performance of the 2024 airdrops, most have underperformed after launch. While a few saw impressive returns early on, most tokens faced downward pressure as the market readjusted their value. This pattern points to a broader problem within the airdrop model: many users may be there simply to receive incentives rather than interacting with the protocol long-term.

With all airdrops, a key question arises — does the protocol have staying power? Once the initial rewards are distributed, do users continue to see value in the platform, or is their participation purely transactional? Our analysis of data across multiple time frames reveals a key insight: for most of these tokens, enthusiasm wanes quickly, typically within the first two weeks.

Overall performance

Looking at the 15-day, 30-day, and 90-day price action, it’s clear that most of the price movement occurred in the first few days after the airdrop. Three months later, very few tokens have managed to post positive gains, with only a few bucking the trend. Still, it’s important to consider the broader context: the overall crypto market has not performed well during this time, which complicates the situation.

On-chain distribution

Despite the overall poor performance, this is not the case for all chains. Of the 62 airdrops analyzed, only 8 achieved positive returns after 90 days - 4 on Ethereum and 4 on Solana. There were no winners on BNB, Starknet, Arbitrum, Merlin, Blast, Mode, and ZkSync. Solana had a success rate of 25%, while Ethereum had a success rate of 14.8%.

This is not surprising for Solana, as the chain has become a retail favorite and a real challenger to Ethereum’s dominance over the past two years. And given that many of the other chains we looked at are second-layer chains that are in direct competition with another chain, it’s not shocking that only the parent chain retains a few winners.

While we did not include Telegram’s TON network, we did want to point out that there have been quite a few successful airdrops on the network as enthusiasm and adoption grew.

The difference between different public chains (Chain Division)

That is, if we try to separate the large chains and their airdrops, does the data change when we take into account the performance of the public chain tokens? When we normalize these airdrop prices and compare them to the performance of their respective ecosystems - for example, comparing the airdrop on Polygon to the price trend of $MATIC, or comparing the airdrop on Solana to $SOL - the results are still not optimistic.

Yes, the market has fallen and the 2023 highs have cooled, but that is not enough to mask the lackluster nature of airdrops, both with system tokens and with altcoins in general. These sell-offs are not completely isolated from the larger narrative, reflecting the market’s general fear of short-term exuberance. No one wants something untested or “new” when something that is already considered “established” is falling.

Overall, the improvements have been modest at best, with Solana and ETH seeing around 15-20% drops in the worst cases over certain 90-day windows, which still suggests these airdrops were far more volatile and only connected in the overall narrative, not in price performance.

Performance by allocation

Another key factor that affects airdrop performance is the distribution of the total token supply. A protocol’s decision on how much of the token supply to allocate can significantly impact its price performance. This raises key questions: Is the generosity worth it? Or is it safer to be conservative? Will giving users more tokens lead to better price movements, or is there a risk of giving too many too quickly?

To break this down, we’ll divide the airdrops into three groups:

  • Small airdrop: 5% of total token supply

  • Medium airdrop: >5% and ≤10%

  • Large airdrop: >10%

We then examined their performance over three time periods – 15 days, 30 days, and 90 days.

In the short term (15 days), smaller airdrops (5%) perform better, probably because the limited supply creates less immediate selling pressure. However, this initial success was often short-lived, with tokens from small airdrops experiencing significant sell-offs within three months. This is likely due to a combination of factors: low supply initially suppressed selling, but over time, as the narrative shifted or insiders started selling, the wider community followed suit.

Medium-sized airdrops (5-10%) performed slightly better, balancing supply allocation with user retention. However, large airdrops (>10%) performed best over longer time frames. These larger allocations, while potentially at greater risk of selling pressure in the short term, appear to foster a stronger sense of community ownership. By allocating more tokens, protocols may empower users and give them a greater stake in the project's success. This, in turn, can lead to better price stability and long-term performance.

Ultimately, this data suggests that it pays to be less stingy with token distribution. Protocols that are generous in their airdrops tend to foster a more engaged user base, leading to better results over time.

Distribution Dynamics

Impact of Token Distribution

Our analysis shows that the size of the airdrop directly affects price performance. Small airdrops create less initial selling pressure but tend to see significant selling within a few months. On the other hand, larger allocations do create more volatility early on but lead to stronger long-term performance, suggesting that generosity encourages more loyalty and token support.

Correlating distribution with market sentiment

Community sentiment is a key, though often elusive, factor in a successful airdrop. Larger token allocations are often seen as fairer, giving users a stronger sense of ownership and involvement. This creates a positive feedback loop — users feel more engaged and less likely to sell their tokens, contributing to long-term stability. In contrast, smaller allocations may initially feel safer, but often lead to a brief burst of enthusiasm followed by a rapid sell-off.

While it is difficult to quantify the sentiment or “vibe” of all 62 airdrops, they are still strong indicators of a project’s enduring appeal. Signs of strong sentiment include active and engaged communities on platforms like Discord, organic discussions on social media, and real interest in the product. Additionally, the newness and innovation of a product often help sustain positive momentum because they attract more committed users rather than opportunistic reward hunters.

Impact of Fully Diluted Value

An important area of ​​focus is whether a token’s fully diluted value (FDV) at launch has a significant impact on its post-airdrop performance. FDV represents the total market value of a cryptocurrency if all possible tokens were in circulation, including tokens that have not yet been unlocked or allocated. It is calculated by multiplying the current token price by the total token supply, including circulating tokens and any locked, vested or future tokens.

In the crypto space, we often see projects with seemingly inflated FDVs compared to the actual utility or impact of the protocol at launch. This raises a key question: are tokens penalized for having inflated FDVs at launch, or does the impact of FDV vary from project to project?

Our data covers projects ranging from those launched with a conservative FDV of $5.9 million to those launched with a staggering $19 billion — a 3,000x difference across the sample of 62 airdrops we analyzed.

When we plot this data, a clear trend emerges: regardless of project type, hype level, or community sentiment, the greater the FDV at launch, the greater the likelihood of a significant price drop.

FDV Relationship

There are two main factors at play here. The first is a basic market principle: investors are attracted to the perception of upward mobility. Tokens with small FDVs offer room for growth and the psychological comfort of “getting in early,” attracting investors with the promise of future gains. On the other hand, projects with inflated FDVs often struggle to maintain momentum as the perceived upside becomes limited.

Economists have long discussed the concept of market “space.” As Robert Shiller has argued, “irrational exuberance” quickly fades when investors feel that returns are limited. In crypto, that exuberance can fade just as quickly when a token’s FDV indicates limited growth potential.

The second factor is more technical: liquidity. Tokens with large FDVs often lack the liquidity to support these valuations. When large incentives are distributed to the community, even a small number of users who want to cash out can create a huge selling pressure, while there are no buyers on the other side.

Take $JUP, for example, which launched with a FDV of $690 million, backed by a range of liquidity pools and market makers that we estimate to be $22 million on launch day. This gives $JUP a liquidity-to-FDV ratio of just 0.03%. This is relatively low compared to its meme coin $WEN, which has a liquidity-to-FDV ratio of 2%, but relatively high compared to other tokens in its same weight class.

Compare this to Wormhole, which launched with a massive FDV of $13 billion. To achieve the same 0.03% liquidity ratio, Wormhole would need to have $39 million in liquidity across venues. However, even including all available pools, official and unofficial, and Cex liquidity, our best estimate is closer to $6 million — a fraction of the required amount. With 17% of tokens allocated to users, the stage is set for a potentially unsustainable market cap. $W has fallen 83% since launch.

As a market maker, we know that without sufficient liquidity, prices become highly sensitive to selling pressure. The combination of two factors — the psychological demand for growth potential and the actual liquidity required to support a large FDV — explains why tokens with higher FDVs have difficulty maintaining their value.

The data bears this out. Tokens with lower FDVs experienced less price erosion, while those that launched with inflated valuations suffered the most in the months following their airdrop.

Overall winners and losers

To get a deeper understanding of some of the players, we picked out a few examples of this quarter’s airdrop winners and losers to analyze, exploring what they did well and where they misstepped, which led to successful community launches and less successful ones.

Airdrop Season: A Case Study of Winners and Losers

As we dive deeper into airdrop season, let's examine a standout winner and a notable underperformer to reveal the factors that led to their contrasting outcomes. We'll explore what these projects did right or wrong, which ultimately shaped their success or failure in the eyes of the community.

Winner: $DRIFT

First up is Drift, a decentralized futures trading platform that has been operating on Solana for nearly three years. Drift’s journey has been filled with triumphs and challenges, including withstanding several hacks and exploits. However, each setback has forged a stronger protocol, evolving into a platform that has proven its value far beyond airdrop farming.

When Drift’s airdrop finally arrived, it was met with enthusiasm, especially from its long-term user base. The team strategically allocated 12% of the total token supply for the airdrop, a relatively high percentage, and introduced a clever bonus system that kicks in every six hours after the initial distribution.

Launching with a modest market cap of $56 million, Drift surprised many, especially compared to other virtual automated market makers (vAMMs) that had fewer users and less history, but higher valuations. Drift’s value quickly reflected its true potential, reaching a market cap of $163 million — a 2.9x increase since launch.

The key to Drift’s success is its fair and thoughtful distribution. By rewarding long-term, loyal users, Drift effectively filters out new Sybil farmers, fosters a more authentic community, and avoids the toxicity that sometimes plagues such events.

What makes Drift stand out?

Heritage and a solid foundation

  • Drift's long history allows it to reward its existing base of determined users.

  • With a high-quality, proven product, teams can easily identify and reward true super users.

Generous tiered allocation

  • Allocating 12% of the total supply—a significant proportion for an airdrop—demonstrates Drift’s commitment to its community.

  • The phased release structure helps minimize selling pressure and keep the value stable after release.

  • Crucially, airdrops are designed to reward actual usage, not just metrics inflated by point farming.

Realistic valuation

  • Drift’s conservative launch valuation avoids the trap of excessive hype and keeps expectations stable.

  • Sufficient liquidity is seeded in the initial liquidity pool to ensure the smooth operation of the market.

  • The low fully diluted valuation (FDV) not only makes Drift stand out, but also sparks a broader industry discussion about overvalued competitors.

Drift’s success is not accidental; it is the result of intentional choices that prioritized product strength, fairness, and sustainability over short-term hype. As airdrop season continues, it’s clear that protocols hoping to replicate Drift’s success would be best served by focusing on building a solid foundation, fostering real user engagement, and maintaining a realistic view of their market value.

$ZEND: From Hype to Crash — A Starknet Airdrop Failure

ZkLend ($ZEND) is now facing a major downturn - its value has plummeted by 95% and it is struggling to exceed $400,000 in daily trading volume. This is a stark contrast for a project that once had a market cap of $300 million. Even more unusual is that ZkLend's total locked value (TVL) is now more than double its fully diluted valuation (FDV) - this is uncommon in the crypto world and is not a positive sign.

So how did a project that rode high on the hype surrounding Starknet — a zk-rollup solution designed to scale ethereum — end up in such a precarious position?

Missed the Starknet wave but didn't get on the boat

There is nothing groundbreaking about the concept of ZkLend — it aims to be a lending platform for a variety of assets, benefiting from the Starknet narrative. The protocol has taken advantage of Starknet’s momentum to position itself as a key player in the cross-chain liquidity ecosystem.

premise:

  • Generate a farming network where users can earn rewards across different protocols.

  • Attract liquidity and users through rewards and cross-chain activities.

However, in execution, the platform ended up attracting “hired” activity farmers — users who were only interested in short-term rewards and had no commitment to the long-term health of the protocol. Rather than fostering a sustainable ecosystem, ZkLend found itself at the mercy of reward hunters, resulting in short-lived engagement and low retention.

Backfired airdrop

ZkLend’s airdrop strategy exacerbated its problems. There was no significant product or brand recognition prior to the airdrop, and the token distribution attracted speculators rather than real users. This critical failure—the failure to adequately vet participants—led to:

  • Lots of bounty hunters, eager to cash out quickly.

  • There is a lack of loyalty or real engagement, and participants have no long-term commitment.

  • The token value collapsed rapidly as speculators immediately sold their tokens.

Rather than building momentum and fostering loyalty, the airdrop created a brief burst of activity that quickly faded.

The warning

The ZkLend experience is a powerful reminder that while hype and airdrops can bring users, they do not inherently create value, utility, or sustainable communities.

Key Lessons:

  • Hype alone is not enough – building real value requires more than just hype around a popular narrative.

  • Airdrops to unvetted users can attract speculation and destroy value, as experienced by ZkLend.

  • There is a huge risk in overvaluing new products without a proven use case.

in conclusion

If maximizing returns is the goal, selling on the first day is often the best move — 85% of airdropped tokens lose value within a few months. Solana leads as the top public chain in 2024, but overall performance is not as bad as expected given market conditions. Projects like WEN and JUP stand out as success stories, showing that a strategic approach can still deliver strong returns.

Contrary to popular belief, larger airdrops don’t always lead to sell-offs. A token with a 70% airdrop allocation saw positive gains, highlighting that FDV management is more important. Overestimating FDV is a critical mistake. High FDV limits growth potential and, more importantly, creates liquidity issues — inflated FDV requires a lot of liquidity to maintain, which is often not available. Without sufficient liquidity, airdropped tokens are vulnerable to severe price drops as there is not enough capital to absorb the selling pressure. Projects that launch with a realistic FDV and a solid liquidity provision plan are better able to survive post-airdrop volatility.

Liquidity is critical. When FDV is too high, it puts tremendous pressure on liquidity. In the absence of liquidity, a massive sell-off can crush prices, especially in airdrops where recipients are eager to sell. By maintaining a manageable FDV and focusing on liquidity, projects can create better stability and long-term growth potential.

Ultimately, the success of an airdrop is not just about the size of the allocation. FDV, liquidity, community engagement, and narrative all matter. Projects like WEN and JUP have found the right balance and built lasting value, while other projects with inflated FDV and shallow liquidity have failed to maintain interest.

In a fast-moving market, many investors make quick decisions — selling on the first day is often the safest bet. But for those who focus on long-term fundamentals, there are always coins worth holding on to.