Optimism token falls 40%, prompting calls to bar dumpers from airdrops


Optimism’s freshly launched governance token, OP, has plunged 40% since peaking at $2.10, main members of the neighborhood to debate baring those that dumped their tokens from future airdrops.

Cointelegraph reported on Tuesday that the Ethereum layer-2 scaling answer was overwhelmed with demand for the primary OP governance token airdrop, as 5% of the token provide was distributed to round 250,000 eligible customers.

As per CoinGecko information, the token opened at roughly $1.43 earlier than surging to $2.10, however as extra customers bought their fingers on the free airdrop over the day, OP dropped to as little as $1.09 earlier than climbing again to $1.18 on the time of writing, marking a 43% drop.

Following the sharp drop of OP’s value, a member of Optimism’s governance neighborhood who goes by OxJohn put forward a proposal within the Optimism governance discussion board to exclude addresses that dumped 100% of their airdropped tokens. The submit garnered a big quantity of consideration from the neighborhood, pulling in 11,200 views, 305 replies and 595 likes.

OxJohn highlighted a number of addresses that acquired no less than 32,000 OP tokens and promptly dumped them in the marketplace, arguing that their actions are “counter-productive” to the neighborhood and diluted the governance course of.

The OP hodler went on to recommend that these accounts ought to be barred from the subsequent spherical of OP airdrops with “a public checklist of accounts that have interaction on this conduct” excluded. Of their view, doing so would see the distribution of governance weight to solely those that plan to actively take part.

“Why ought to Optimism Collective proceed rewarding these sort of mercenary actors who will dump their tokens on first sight? Why ought to any future airdrops reward these addresses?”

The proposal was submitted purely for concepts and suggestions and isn’t near the stage of being voted on. The response from the governance neighborhood has been blended to this point. Some customers had been in full assist, others rejected the thought completely, and a few had been calling for a extra nuanced place.

Consumer Mohammedt75 mentioned, “Very legitimate factors. Incentivize individuals who care about the long run and let others who don’t care concerning the ecosystem pack and get out.”

Mgomes said that “one of many objectives of the airdrop is to incentivize folks to make use of the chain. Even when they plan to dump it’s tremendous, as a result of they’ve used Optimism and in the event that they favored the chain they may maintain utilizing it.“

Member JustinMarx additionally highlighted an attention-grabbing counterpoint, stating that dumpers shouldn’t be penalized as “you by no means know the non-public circumstances of somebody who dumped their tokens.”

Some of the high-profile Crypto Twitter customers to weigh in was Cobie, the co-host of the UpOnly crypto podcast who has practically 700,000 followers. He responded to the proposal in his typical satirical/mocking method.

Cobie submitted a prolonged counter-proposal within the discussion board titled “Extended ineligibility for future airdrops” that was quickly eliminated resulting from being flagged as “inappropriate” however has since been reinstated.

In it, he mentioned that “my lack of assist for this proposal isn’t as a result of I disagree with the sentiment. Quite the opposite, it’s as a result of this proposal doesn’t go far sufficient.”

“I suggest that we, Optimism Collective, cancel the long run airdrops of anybody that has offered any token within the final 6 months. These folks have a sample of undesirable conduct, we are able to take into account them ‘potential future sellers’.”

To counter potential future sellers, Cobie urged issuing them with a debt token and in addition contemplating using “bodily violence” in opposition to them.

Nevertheless, after being prompted to offer a extra critical response to the proposal, Cobie highlighted a number of the explanation why he thinks that it’s a foul concept.

Associated: ETH/USD buying and selling pair attracts extra merchants within the first quarter of 2022: Report

He made factors resembling OP’s early value being irrelevant, sellers having totally different motives, the chance to promote and nonetheless have interaction with governance, the token getting used as a part of buyer acquisition prices from Optimism, and the convenience of constructing a brand new handle to keep away from restrictions.

“The one those who care are price-speculators, merchants and short-term traders. Governance definitely performs the identical whether or not the value is $1.50 or $2. Certain, in depth value modifications may make governance assaults on Optimism cheaper, however there’s not a single point out of that within the preliminary proposal.”

“And it isn’t actually a priority given the dimensions of the airdrop or the short-term nature of the sell-pressure from ‘instantaneous dumpers’,” he added.

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