Optimism is a “Layer 2” Ethereum scalability solution (ETH-USD). Its OP coin was “airdropped” this week to its users and “Active Ethereum Participants.” If you’re engaged in a DAO or enjoy Ethereum applications but “bridge to other chains owing to excessive costs,” you might claim OP tokens.
Optimism’s airdrop stalled. “Panicked users grumbled that some claims may collect their tokens [before] Optimism posted about the launch,” CoinDesk reports.
After several beneficiaries sold their OP crypto, the price dropped from $4.50 to $1.30. In this bear market, it’s understandable to desire to earn a fast buck. Selling OP airdrops is like selling a hot IPO stock.
They frequently start terribly… Some become international leaders.
So, Optimism crypto is like an IPO stock… Is it a Facebook (NASDAQ:FB) or Pets.com?
Unlike the Dot-Com Crash, Optimism Is Profitable
Optimism earns twice as much as its closest Layer 2 competition, Arbitrum. Layer 1 Ethereum alternatives… Optimism has more transaction income than Avalanche, Polygon, Cardano, Fantom, and NEAR Protocol combined!
Layer 2s’ investments are unclear. According to Blockworks’ Byron Gilliam, they’re “like WeWork, but for blockspace.” They acquire Ethereum blocks in bulk and resell them. That’s good since it scales L1s, but I don’t see how they’ll gain value or why they need a token.
“They can take a margin reselling L1 blockspace, but if it’s more than razor-thin, another L2 will provide the same service cheaper,” Gilliam says. L2s may become common (not rare) commodities.
Vitalik Buterin of Ethereum backs Optimism. “Optimism has aims other than’make OP go up,’ and the only way to achieve that long-term is with clear non-token-holder interests,” he tweeted yesterday.
Vitalik likes “two-house government” at Optimism.
Governance is like a security guard or nanny: Boring…until it isn’t. Terra (LUNA-USD). Do Kwon, the self-proclaimed “master of stablecoin,” is the subject of daily rumors and claims. What better call to governance?
Optimism’s “citizens” and OP tokenholders will manage the initiative. Cointelegraph says that the pair shares network governance decisions and citizenships.
While anybody may purchase and sell the OP coin, citizenship won’t be transferable, according to Vitalik Buterin’s “soulbound NFTs.”
Optimism should operate more democratically with tokenholders and people possessing authority. Many crypto enterprises are run by a tiny cabal of founders and investors. they contain more tokens In Optimism’s “Citizen House,” it’ll be more like voting: Vote once.
Governance shouldn’t be the forgotten “G” in ESG.
We Should Prevent a Terra/Luna-Style Calamity
Governance is simply one consideration in analyzing Optimism crypto for investment, as Messari researchers investigated in their May paper, “The Value of Optimism.” According to our valuation model, Optimism should be a top 20 crypto asset upon launch with a $9 billion market worth.
OP crypto has lots of space to go at $9 billion. At $1.30 and 4.3 billion tokens, Optimism’s market value is $5.6 billion.
Unknown is how rocky OP crypto‘s trip will be. “Bumpy” is an understatement in a bear market:
Fears that the Fed will keep rising rates, penalizing growth investments, are stifling everything now… Yesterday was a good stock day.
Compare bitcoin trading to Cathie Wood’s ARK Innovation ETF growth stocks (NYSEARCA:ARKK). ARKK climbed 7.4% on Thursday, although other big cryptos only gained 1% or 2%.
“While we remain positive on cryptos’ long-term potential, we anticipate things will get worse before they get better,” Luke Lango says in his team’s latest newsletter.
We recommend a sensible and careful dollar-cost-averaging technique, and we’ll only open fresh positions with strong confidence.
This will be our plan till the markets stabilize.