Hamster Kombat price has continued its remarkable sell-off, confirming it as one of the most disappointing airdrops of the year. Data by OKX shows that the HMSTR token was trading at $0.0023, a few points above its all-time low.
HMSTR sell-off gains steam
HMSTR’s performance has cost investors and players millions of dollars as the fully diluted market cap has moved from over $700 million in October to $237 million. This is a significantly small amount since analysts were expecting it to have a market cap of over $5 billion because of its bigger size than Notcoin,
Hamster Kombat is not alone as other Telegram tokens have also imploded. Catizen, which runs the biggest gaming mini application in the network, has crashed, bringing its market cap to just $80 million.
Hamster Kombat’s plunge has happened at a time when its futures open interest has been in a strong downward trend. This interest bottomed at $34 million on Tuesday, down from a record high of over $71 million last month. This is a sign that demand for the coin has largely evaporated.
A likely reason for this drop is that holders expect more dilution in the longer term since only 64 billion of these tokens are in circulation. The rest are locked and will be released periodically, leading to more dilution of existing users.
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The other reason is that the number of users on the platform has continued dropping, with many of them being disappointed by the crash. Data shows that active users have dropped to about 41 million, down from a record high of 300 million.
This is a similar situation to other play-to-earn coins like Gala Games and Decentraland that peaked in 2021. These coins have never recovered as the number of users in the ecosystem plunged.
Hamster Kombat price forecast
HMSTR chart by TradingView
The 4H chart shows that the HMSTR token has formed two important technical patterns. First, oscillators like the Relative Strength Index (RSI) and the Stochastic have formed a bullish divergence pattern and are pointing upwards. They have also moved from their oversold levels.
Second, it has formed a falling wedge pattern, a popular bullish sign. Therefore, with the two lines of the wedge pattern nearing their confluence level, there is a likelihood that it will soon have a bullish breakout. If this happens, the next point to watch will be at $0.0030, its highest swing on October 29.
