Luccy, BlockBeats
Editor’s Note: TIA’s repledge and DYM’s airdrop are undoubtedly one of the hottest topics in this bull market, attracting attention to various repledge track projects. Those who missed out on DYM are eager to search for repledge projects to potentially receive airdrops. In response to this, Taiki Maeda, the founder and CEO of cryptocurrency research company HFAresearch, shared his thoughts on TIA in a lengthy post on social media.
Taiki Maeda believes that TIA’s repledge narrative and the development of bearish expectations are similar to OHM. As buyers become less sensitive to price due to airdrop expectations, TIA may fall into a (3,3) situation. Taiki Maeda points out that there will come a day when pledging TIA becomes meaningless, but he also believes that we have not reached that point yet.
This will be a long thread, but I hope it will be an interesting read for those studying cryptocurrency Ponzi economics, human greed, and market bubble theories. So let’s get started.
This article will be divided into four parts:
1. What is Celestia?
2. What is the narrative surrounding TIA?
3. What are the similarities between TIA and (3,3)?
4. What preparations am I making for this?
Before you get mad at me, let me clarify that I’m not saying Celestia is a Ponzi scheme. In fact, I believe it is one of the most important technological advancements we have seen in a long time.
TLDR: Celestia makes it easier, or cheaper, for new projects to deploy new rollups and blockchains.
For example, Manta Network saved over 99% of costs by using Celestia for data availability (DA) instead of Ethereum. These significant cost savings have tangible benefits for users.
Here’s another piece of information to help you better understand it. Since I don’t want this article to be too long, I will continue discussing the narrative behind the TIA token and the reasons for the skyrocketing price since the November TGE.
I believe TIA is the purest way to understand the 2024-25 airdrop story. We already know that TIA pledgers have received two airdrops (Sagaxyz and Dymension), and more airdrops have been confirmed, such as Manta Network.
Celestia makes it easier to launch new rollups. Some rollups will airdrop to TIA pledgers, and L1/L2 tokens have a premium in the market.
Therefore, we see the formation of a narrative: “The price of TIA doesn’t matter because the airdrops are enough to compensate for it.”
For example, with my DYM airdrop, it has already covered the cost basis of my TIA at $4 that I invested in @aevoxyz. So if I choose to liquidate my airdrop, that position has already earned back its cost. But I don’t plan to do that, though that’s a topic for another discussion.
You can see how this could be a reflexive cycle. As more and more airdrops occur, we should see more buying and pledging of TIA for future airdrop demand. We have already seen an increase in the number of delegators, which is closely related to the price of TIA.
Pledging TIA tokens also aligns with my view of the highly anticipated alt-L1 trading returns. Instead of trying to pick L1/L2 tokens in the upcoming cycle, why not choose to pledge TIA and passively receive airdrops?
For most people, this is a psychologically more comfortable narrative.
I also observe some similarities from the perspective of Solana/Cosmos. During the bear market, many teams have been developing and raising significant funds from venture capital firms. Some of these teams will airdrop to ATOM, OSMO, and TIA pledgers, further reinforcing this narrative.
But what makes it the (3,3) of this cycle? Here’s the progression:
1. Market sees a lot of airdrops (e.g., DYM)
2. Market expects more airdrops
3. People dream about the scale of these airdrops
4. Buyers become increasingly insensitive to price due to airdrop expectations
We can simplify the market pricing of TIA to this general function: TIA valuation = future value of the DA layer + meme + narrative + future expectations of airdrops to TIA pledgers. But honestly, nobody knows how to value this.
So naturally, our brains simplify it to the narrative of airdrops. Who cares about the valuation of TIA if we can pledge $1,000 and receive over $1,000 worth of airdrops, right?
Does this sound familiar?
“OHM’s price can rise 99%, but you’ll be fine because the APY will compensate for it.”
“The price of TIA doesn’t matter because the airdrops can compensate for it.”
These are two completely different projects, but the narratives have similarities. It has the characteristics of a future bubble.
Furthermore, other industries also love airdrops, so why not?
After all, the promise of turning $100 into $100,000 sounds amazing. Look at these thumbnails and view counts! People need these videos, which in turn motivate YouTubers or TikTokers to provide these videos.
“But Taiki, you’re also making these videos!”
Yes, but Celestia just launched two months ago, and we only had two airdrop snapshots. I expect there will be more in 2024-25. There will come a day when pledging TIA becomes meaningless, but I don’t think we’re there yet.
A profit-oriented person recognizes this and chooses to participate as long as we’re “early enough.” This is not unreasonable. I believe TIA is one of the most important innovations of this cycle, but that doesn’t mean it’s easy to create a bubble.
I’m writing this article to remind myself to be humbly profitable in the future, even when the narrative feels invincible. Here’s my view on the price trend of TIA in the next cycle (I drew this within 30 seconds):
I believe TIA will be an amazing asset during the bull market, but it will also be an extremely painful asset during the bear market. Once people realize that valuation doesn’t matter and airdrops are diluted, they will start to liquidate. The 21-day unbonding period will make this reality even more severe.
So, what’s the plan?
I will pledge TIA, hold some airdrops, and sell some airdrops. When will I sell TIA? Honestly, I don’t know. My current plan is to start liquidating my TIA position once Coinbase ranks first in the Apple App Store or when major companies reach ATH.
This article was written on January 13, 2024, and if you’re reading this in the future, my views may have changed. I may also be completely wrong, but that’s the risk of putting my thoughts on the internet.
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