FLR sent out for free to thousands of users as a publicity stunt;
The token was created by Flare Network, the blockchain interoperability company;
The turnover in the first few days reached $1 billion.
One of the biggest promises in the cryptocurrency world has fallen apart. The Flare Network was promising a couple of years ago with the launch of its native token, called FLR. However, once it was introduced, the digital asset dropped 74% in value, disappointing its users.
Protocol, the purpose of which is to facilitate the interoperability of different blockchains, that is, different databases. To promote its token, Flare Network has promised to send units of its new assets for free to holders of XRP, the sixth-largest token or cryptocurrency in the world.
This practice is known as airdrop and is widely used in cryptocurrency as a form of advertising. In many protocols, it is not possible to prevent people from sending tokens to your wallet. Since the token can also contain programming code, this has become a very common problem with the spread of viruses and malware.
It turns out that the company fulfilled its promise to carry out airdrops on a one-to-one basis, that is, for every 1 XRP held by the user, 1 FLR was sent. This means that about 15% of the total amount of FLR produced ended up in the wallets of thousands of users for free, and there is more due to be distributed in the next three years.
At the time of launch, the tokens had an approximate value of 0.05 USD, or 0.26 Brazilian real, on the exchanges. In just a few moments, the price of the digital asset increased by 200%, reaching $0.15 (0.78 R$). However, as users who got the asset for free sold it as a way to make an easy profit, the valuation reversed to a 74% drop within hours.
The asset was worth $0.02 USD (0.10 R$). At the moment, the price has already recovered and is again around 0.05 USD, or 0.26 R$. However, the turnover amounted to 1 billion US dollars, or 5.4 billion Brazilian reals. Token holders will be able to participate in Flare Network governance decisions, be able to vote on projects and propose changes.