It appears numerous Optimism users who declared the other day's token airdrop are now leaving the network. The mass exodus has actually triggered efficiency problems on Layer 2 bridges.
Key Takeaways
- Many receivers of Optimism's brand-new OP token have actually started unloading their holdings and moving them back to Ethereum mainnet.
- The exodus has actually triggered an absence of liquidity in bridges linking Optimism to Ethereum mainnet, leading to sluggish and stopped working transfers in between the 2 networks.
- The OP token's cost has actually decreased 70% given that it started trading-- not a completely uncommon result for preliminary token airdrops.
The Optimism token has actually likewise dropped over 70% given that trading started the other day.
Users Cash Out From Optimism
Optimism airdrop receivers are taking their gains back to Ethereum.
Bridges linking Ethereum to the Layer 2 network Optimism are experiencing efficiency concerns today as users who got the network's token airdrop send their gains back to Ethereum mainnet.
Hop Protocol, the biggest Optimism to Ethereum bridge, reported on Discord Wednesday early morning that the bridge was seeing "a big spike in volume" which transfers back to mainnet would be handicapped up until extra USDC and ETH liquidity was maximized. Users of Synapse and Across Protocol, 2 contending bridges, have actually likewise reported sluggish or stopped working Optimism withdrawals. According to a dev assistance account in the Across Protocol Discord server, the procedure was seeing a high variety of transfers far from Optimism towards the Ethereum Mainnet. "This is triggering some short-term liquidity scarcities on the location chains, and some transfers can be postponed. Any postponed transfers must be settled within 2 hours," they stated.
Optimism is a Layer 2 network developed to assist scale Ethereum. The other day, over 249,00 0 early Optimism users who fulfilled specific requirements got an airdrop of the network's freshly released OP token. The Optimism group tried to airdrop tokens to active and engaged network users over those looking to farm the airdrop, numerous receivers are selecting to transform their OP tokens to ETH and send their funds back to Ethereum mainnet.
As an outcome of the exodus, the OP token rate has actually been struck hard. Quickly after the airdrop went live, OP began trading at around $4.52, putting the token's totally watered down worth at over $19 billion. As more users declared their airdrop, the token's cost plunged. The OP token's rate appears to have actually supported and is presently altering hands for $1.34, down over 70% because its launch.
The OP token's sharp decrease was not completely unanticipated. Previous airdropped tokens, such as those from ParaSwap and CoW Protocol, likewise experienced comparable decreases quickly after releasing. On the other hand, in 2015's Ethereum Name Service airdrop had the ability to recuperate from its preliminary drop in the short-term. With risk-on cravings in the wider crypto market subsiding, it seems an uphill struggle for OP token bulls moving forward.
Disclosure: At the time of composing this piece, the author owned ETH and a number of other cryptocurrencies.
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