Blur Airdrop Analysis: What is the token economy? How much is one worth?

The NFT market Blur has temporarily concluded a series of airdrop events, with its token Blur officially available for claiming as of early this morning, leading to congestion on the Ethereum network and a surge in gas fees. However, what is the actual value of the BLUR token? And how does the token economy look?

$BLUR is now LIVE

All traders across all marketplaces in the last 3 months, Care Package holders, and Creators are eligible for the airdrop.

You have 60 days to claim your BLUR ⏰ pic.twitter.com/AZynnHeIhz

— Blur (@blur_io) February 14, 2023

Blur Token Economy

According to the official documentation of Blur here, the total supply of Blur is 3 billion tokens, distributed as follows:

• 51% allocated to community members totaling 1.53 billion tokens
• 29% allocated to past and future core contributors, approximately 867 million tokens, to be unlocked over 4 years with the first 4 months as a lock-up period
• 18.8% allocated to investors, around 565 million tokens, to be unlocked over 4 years with the first 4 months as a lock-up period
• 1.2% allocated to advisors, about 36 million tokens, to be unlocked over 4-5 years with the first 4-16 months as a lock-up period

In the current airdrop activity, 12% of Blur, which is 360 million tokens, has been distributed to eligible users. The remaining 39%, 1.17 billion tokens, will be distributed according to a schedule through contributor grants, community proposals, and incentive programs. Within this 39%, 10% has been confirmed to be allocated in the next incentive program.

This means that Blur has guaranteed ongoing token distribution events for the next four years, although the proportion will decrease year by year.

What is the value of Blur tokens?

When comparing Blur with the NFT exchanges X2Y2 and Looksrare in terms of trading volume or the number of unique buyers, Blur surpasses the other two.

The fully diluted market capitalization (FDMC) of X2Y2 and LOOKS tokens are 156 million and 280 million USD respectively. If we determine the price based on "trading volume and user count," Blur's FDMC should be the highest.

If Blur's FDMC is assumed to be equal to LOOKS' 280 million USD, the price of BLUR should be 0.1 USD.

However, as of the deadline, Blur's market price has already reached 0.72 USD, with an FDMC of 2.14 billion USD, which is 7 times that of Looksrare. The recent trading volume of Blur is approximately 10-15 times that of Looksrare, but to some extent, this is driven by Blur's airdrop activities, attracting users to generate transactions.

Although the current price of BLUR raises suspicions of being too high, the token price depends not only on market performance but also significantly on its functionality.

According to Blur's official documentation, BLUR will be used to manage key parameters of the Blur protocol, which will control the protocol's value growth and distribution, similar to the function of governance tokens. However, whether the related functions can support the current high price of BLUR remains to be verified through the subsequent operation of the protocol.

Additionally, if we refer to the price trend charts of X2Y2 and LOOKS tokens, the peak of both tokens occurred within a week of token issuance.