Here are the possible reasons

TON ecosystem tokens listed on major crypto exchanges have dropped significantly recently.

The largest tokens by market cap in the TON ecosystem have seen a sharp decline in the past few days. Compared to the all-time high (ATH), the decline reached 30-50%.

Notably, many of them have recently been listed on major crypto exchanges. These include Dogs (DOGS), Hamster Kombat (HMSTR) and Catizen (CATI). Toncoin (TON) token also dropped significantly; more than 8% in one week.

Best TON ecosystem tokens by market cap | Source: CoinMarketCap

The market value of TON ecosystem tokens continues to decline; transaction volumes fell more than 27% to $675 million. The ratio of buy and sell orders on the Binance crypto exchange shows that investors are rushing to get rid of the once-coveted tokens.

DOGS is down 58% but developers have a plan B

Since its listing on August 26, the 81.5% community-provided DOGS token has fallen more than 58% to $0.0006599. It is noteworthy that there is no qualifying period, so users were able to trade their DOG immediately after the airdrop and, as a result, sell it immediately after listing.

Amidst the token price crash in late September, the DOGS team announced an upcoming token burn to reduce the total number of DOGS. Typically, the purpose of burning a token is to increase its value; The number of unclaimed coins that should be removed from circulation will be voted on by asset holders.

Hamster Kombat failed to meet expectations after airdrop

The excitement of the Hamster Kombat community dropped shortly after the token distribution. Despite initial interest in the project, active selling of HMSTR tokens led to significant losses in value last week.

At the time of listing, the price of the coin on some exchanges reached $0.014, but massive sales quickly reduced the value of the token. The token has lost 50% in value since its launch on September 26.

The catalyst for the decline was apparently the failed airdrop and listing. Users constantly complained about the unfair distribution of rewards, postponements of dates and changes in the rules, the low starting price of HMSTR token transactions and the problem with the sale of HMSTR: for many project participants, the reward for touching the hamster was only a few dollars.

Such users needed help selling tokens, as many exchanges restrict opening orders.

However, despite the rapid decline in rates, open interest in HMSTR Futures remains stable. According to Coinglass, this figure has been at the level of 60 million dollars since the beginning of October.

HMSTR futures OI | Source: Coinglass

Hamster Kombat in many ways repeated the story of Catizen, another Telegram-based project that disappointed users after the airdrop.

An unexpected change in the rules of the game or why they started leaving CATI

CATI also announced the rating of the leaders of the token decline in the TON ecosystem: like other similar projects, the price of the coin has fallen by 50% since September 20.

Catizen’s rise and fall is reminiscent of the path of Hamster Kombat. Shortly before the deployment began, the team unexpectedly changed the rules of the game.

Initially, 43% of the total CATI token supply was intended for players. But the developers unexpectedly changed the conditions so that the community received only 30%.

The discontent of the society was not limited to this. Shortly after the airdrop, it was revealed that user spending in the game affected the token distribution criteria. Those who invested money in the game rather than in time gained a significant advantage.

After this, many players shared stories about how they got the leading spot but received little reward. As a result, a wave of discontent towards the #catizenscam hashtag spread across social networks.

#CatizenScam #Fraud

Top 5 lies the Catizen team tells the community

1 Airdrop in June/July
2 Most implant criteria are vKitty/s or cat level
3 Requested tokens will be received before 10:00 UTC on September 28.
4 Airdrops 43%
5 You can’t get rich if you can’t hold it (then the token goes to waste)

— Rajel💢 (@jela7in) September 28, 2024

Why do Telegram project tokens continue to drop?

Airdrops are considered one of the most popular strategies to attract users. Many projects launched on the Telegram platform used them.

For example, Dogs, Hamster Kombat, Catizen and similar projects actively rewarded users with coins for simple actions. As a result, tokens distributed via airdrop may not maintain long-term interest or maintain their value.

Airdrops, which were used to increase project participation and distribute tokens more widely among users, have likely lost their former impact as users have become oversaturated with such strategies.

For example, KeyRock experts analyzed 62 airdrops across six blockchains since the beginning of 2024. Data showed that 88.7% of tokens showed a significant price drop within 90 days of distribution. Only a few of these have demonstrated sustainability.

Token price movements after airdrops | Source: KeyRock

At the same time, small air drops showed greater resistance in the short term. This is probably due to low selling pressure at the time of the token launch. But in the long run, tokens continue to decline for three months.

Moreover, Telegram-based games are still new and investors can still determine whether the demand for these games will continue. This also fuels the tendency for users to sell tokens, which ultimately negatively affects their price.

CryptoQuant analyst Maartunn told crypto.news that newly launched tokens in the TON ecosystem usually follow a typical excitement cycle.

“Initial short-term expectations tend to be overly high, while long-term expectations are often underestimated.”

Maartunn, CryptoQuant analyst

It also visualized the number of Hamster Token transactions relative to all TON transactions. The trend line shows the classic excitement cycle pattern.

Performance of the HMSTR token. Source: CryptoQuant

Among other recently launched cryptocurrencies, Hamster Kombat is one of the most popular. However, Maartunn noted that many meme coins will eventually fail; Only those with solid foundations and a strong network can survive.