Fact or fiction? Did ApeCoin (APE) really drop by 80% since launch?

2 years ago

ApeCoin (APE), the governance token of the well-known Bored Ape Yacht Club (BAYC) NFT task was airdropped to BAYC and Mutant Ape Yacht Club (MAYC) owners astatine 8.30 AM EST connected March 17 and lone 8 hours aft APE became tradable successful the unfastened market, it has already jumped to the 110th astir traded token ranked by CoinGecko, totalling $900 cardinal successful trading measurement crossed each tracked platforms.

As 1 would expect, determination were immoderate volatile terms movements minutes aft the airdrop and headlines amusement the terms of APE dropping 80% since its launch. This raises the question of whether the mean BAYC and MAYC proprietor really could person sold APE astatine $40 alternatively of $14 that it trades for astatine the clip of publishing.

Let’s instrumentality a look astatine APE’s terms minutes aft the airdrop was claimed and the token listed connected Binance, FTX, Gate and SushiSwap to measure the standard of the terms discrepancies during the archetypal terms find periods.

The spot terms illustration supra shows that connected the FTX one-minute illustration APE was trading arsenic precocious arsenic $40 successful the 2nd infinitesimal but the perpetual terms illustration beneath shows successful the archetypal infinitesimal it lone went up to arsenic precocious arsenic $15 astatine the highest point.

Binance shows a precocious of $28 connected the infinitesimal of the airdrop from the one-minute illustration portion Gate shows an unbelievably precocious $214 connected the aforesaid minute.

While the terms of recently listed tokens are often volatile during the archetypal terms find periods and it is hard to cognize if transactions really happened astatine these levels, the volumes connected these infinitesimal candles tin springiness a bully denotation of what the existent terms of APE was close aft the airdrop.

The trading measurement of Binance is the highest among the 3 platforms utilized successful this nonfiction and the scholar should cognize that APE is besides traded connected different platforms. In the archetypal 5 minutes, Binance's full trading measurement was $42 million, whereas FTX perpetual’s trading measurement is successful full $18 cardinal and the spot measurement is $6 million. Gate lone has $1,665 trading measurement connected the candle that shows the highest terms of $214 and successful full lone $43,000 measurement successful the archetypal 5 minutes.

So it is wide to spot that the much reliable terms of APE minutes aft the airdrop is from Binance, which is astir $28 and happened connected the infinitesimal of the airdrop. It is not uncommon to spot a ample driblet successful terms successful the recently launched tokens successful the aboriginal trading hours, arsenic it happened to galore akin tokens. The question is whether an mean non-tech savvy proprietor could person sold the token successful the archetypal 5 minutes to debar specified a drop. The reply is astir surely no.

First, the state terms for minting APE skyrocketed to 10 times (or adjacent more) of the mean terms close aft the airdrop. Unless 1 is consenting to instrumentality large risks bidding up the state terms to get the APE up of everyone other (and retrieve astatine this constituent the APE terms is astir apt not discoverable anywhere), it is precise hard to adjacent assertion APE wrong 1 minute.

Second, erstwhile APE is successful the recipient's Ethereum wallet, it has to beryllium transferred to centralized exchanges (CEXs) specified arsenic Binance and FTX to beryllium sold. This besides takes immoderate clip depending connected the postulation connected the concatenation astatine the time. The quickest mode would beryllium to usage a decentralised speech (DEX) by simply connecting the Ethereum wallet and swap APE for different token.

However, 1 absorbing reflection is that APE’s liquidity successful the DEX is not arsenic overmuch arsenic successful CEX. The TVL astatine the clip of penning connected Uniswap is comparatively tiny for APE-USDC and APE-DAI pools; and the liquidity connected SushiSwap is precise debased — the full worth locked (TVL) successful the APE-USDT excavation is lone $67,000.

BAYC owners tin assertion astir 10,000 APE per NFT and MAYC owners tin assertion astir 2,000 APE per NFT. This means lone 80 BAYC owners volition beryllium capable to swap the full airdrop astatine the terms of $28 fixed the $45 cardinal TVL of APE-USDC connected Uniswap.

No BAYC owners tin swap the entirety of the airdrop connected SushiSwap for USDT since the TVL of $67,000 cannot screen 10,000 APE swaps per BAYC oregon the 2,000 APE per MAYC astatine the terms of $28.

Given the deficiency of liquidity successful the DEX and the clip it takes to transportation APE to a CEX specified arsenic Binance, it is astir intolerable for an mean proprietor to currency retired successful the archetypal 1 to 2 minutes astatine the top. It seems lone tech-savvy owners (or bots) who cognize however to interact with the blockchain straight with codification tin execute these types of transactions successful specified a abbreviated play of time.

Even if the terms of $40 is existent and APE did driblet 80% from determination to $8, lone precise fewer were capable to merchantability APE astatine that price. A much tenable mode to look astatine the archetypal terms of a recently launched token is to usage the measurement of USD traded wrong the infinitesimal divided by the measurement of the token. In the lawsuit of Binance successful the archetypal minute, the full USDT measurement is 19.66 cardinal and the full APE measurement is 2.15 million, which gives an mean terms of $9.14 successful the archetypal infinitesimal for APE.

Using this fairer mode to look astatine APE’s terms instantly aft the launch, the token really lone dropped 12% since its peak, which is not overly melodramatic fixed the existent bearish environment. When investors work headlines specified arsenic the token terms falls 80% connected its archetypal time adjacent time, marque definite to instrumentality it with a atom of salt.

With Yuga Lab’s aboriginal plans to usage APE for each its products and services and the collaboration with Animoca Brands to physique blockchain NFT games, the aboriginal outlook for APE and the Web3 system built astir NFTs could beryllium precise interesting.

The views and opinions expressed present are solely those of the writer and bash not needfully bespeak the views of Cointelegraph.com. Every concern and trading determination involves risk, you should behaviour your ain probe erstwhile making a decision.

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