FDV is a metric that measures the value of encrypted tokens. In 2020, the median FDV was $140 million, which soared to $1.4 billion in2021. It declined in 2022 but rebounded in 2023 and2024. FDV overlooks short-term market impacts and emphasizes the importance of circulation High FDV and low circulation tokens may distort true valuations, such as World Coin.
economics aim to balance behavior and incentivize project development. Airdrops and protocol activities reward early users, but most airdrop tokens lose long-term value. The cryptocurrency weekly trends can be observed through Coin Metrics’ network stats.
The article discusses different factors of token economics and their impact on token valuations and on-chain activity. It FDV, highlights the importance of circulation supply, examines the effects of airdrops and discusses how they may not lead to long-term user activity.
In conclusion, token economics play a crucial role in cultivating project success and sustainability within the cryptocurrency industry by leveraging users motivations for various behaviors.