What to Do With Your Airdrop Tokens? Hold, Sell, or Stake?

Cryptocurrency airdrops are a distribution method where Web3 projects give away new tokens to eligible community members who have completed certain network tasks. They serve multiple purposes, such as rewarding early adopters and supporting marketing strategies.

By conducting airdrops, projects aim to build awareness and encourage adoption of their cryptocurrency. Our analysts have covered this topic extensively in a article on why projects conduct airdrops.

Why Post-Airdrop Strategy Matters

Rather than exploring airdrops in-depth, this article focuses on on what happens after you receive airdropped tokens. Some participants choose to sell immediately to lock in profits, while others may hold longer for potential gains. These decisions can significantly influence the outcome of your participation.

A CoinGecko report found that 46% of the top 50 largest crypto airdrops since 2020 reached their all-time high prices within just two weeks of listing. While some soared in a matter of days, others—like Optimism (OP)—took over a year to peak, highlighting the volatility and hype surrounding airdropped tokens. Throughout the current market cycle, we’ve seen post-airdrop performance ranging from ~1,180% gains (Hyperliquid) to ~95% losses (Starknet), emphasizing the importance of carefully considering your approach.

By weighing factors like token fundamentals, market conditions, and community interest before making decisions, you can better align your strategy with your own risk tolerance and financial goals.

Understanding Your Crypto Airdrop

Before making decisions, consider these key factors:

• Project evaluation: Analyze the project, team, and technology behind the token.
• Token metrics: Examine the token’s utility and overall tokenomics model.
• Token distribution schedule: Review allocation and vesting details.
• Market conditions: Observe factors like liquidity and overall sentiment.
• Community strength: Gauge the community engagement and growth.

Linity conducts much of this analysis prior to token distribution. The details can be found on our opportunities pages.

However, once tokens are in your wallet, managing them is your responsibility.

Post-Airdrop Strategies Explained

Below are some examples of strategies others in the crypto space have pursued historically. These are not intended as personalized recommendations, but rather an overview of different approaches observed in the market.

1. Holding Tokens

“Holding” airdrop tokens means keeping them in your wallet rather than selling soon after receiving them. This strategy requires patience and strong belief in the project's long-term potential. Looking at historical data from the current and the previous market cycles, some participants who held certain tokens enjoyed substantial gains, while others experienced downturns.

Possible reasons for holding tokens might include:

• Strong fundamentals and real-world utility
• Clear development roadmap and a team with a proven track record
• Fair token distribution and vesting schedules
• Generally favorable market conditions

Example of when holding tokens benefitted the users

Hyperliquid ($HYPE) - rewards up to $29,000

• All-Time High: $34.96 (Dec 22, 2024)
• All-Time Low: $2 (Nov 29, 2024)
• Total Growth (ATL to ATH): 1,648%
• Current Price: $23.64 (Feb 19, 2025)

Hyperliquid’s token launched at $2 on November 29, 2024, and grew to $9.80 within three days. Rather than trending downward after initial excitement, $HYPE continued climbing to a high of $34.96 in late 2024. As of February 19, 2025, $HYPE trades at $23.64, generating an extraordinary 1,180% return for holders who resisted the temptation to sell during early price surges. This performance has elevated Hyperliquid to the hall-of-fame of crypto markets, with its $7.9 billion market capitalization and the 25th position among tokens.

The secret to Hyperliquid's success lies in its thoughtfully designed distribution model. For those who participated and held their tokens, Hyperliquid shows what successful airdrop participation looks like. It provided good financial returns and demonstrates how token distributions can support ecosystem growth.

Morpho ($MORPHO) - rewards up to $30,000

• All-Time High: $4.17 (Jan 17, 2025)
• All-Time Low: $0.7132 (Nov 25, 2024)
• Total Growth (ATL to ATH): 484%
• Current Price: $2.20 (Feb 19, 2025)

Morpho also showed stronger-than-expected price stability, moving from $0.7132 to a peak of $4.17—an approximate 484% increase in a short timeframe. While there have been fluctuations, it remains in a range higher than its initial distribution price, suggesting a degree of ongoing market interest.

Kaito - rewards TBD

• All-Time High: $1.93 (Feb 17, 2025)
• All-Time Low: $0.906 (Feb 20, 2025)
• Total Growth (ATL to ATH): 113%
• Current Price: $1.25 (Feb 20, 2025)

Kaito aims to make Web3 content discovery easier through AI-based aggregation. Since its release on February 20th, $KAITO’s price evolution has been somewhat stable, with the potential for further growth. It's still early in its lifecycle so time will tell how good the token performance will be. However, for the time being, it's qualifying for the benefitting from holding token category.

2. Selling Tokens

Selling involves converting airdropped tokens into other cryptocurrencies (typically stablecoins, BTC, or ETH) after distribution. In this case, an airdrop recipient is more focused on securing the immediate profits.

Based on the ongoing market cycle of 2023-2025, this strategy yielded positive results - especially when the token launches at a high valuation or if the project has uncertain fundamentals. However, there are exceptions, and every contributor should decide on their ideal way of applying these strategies.

Generally, the token sale strategy could make sense when:

• Token launches at a high valuation.
• Token metrics show significant upcoming unlocks (scheduled releases of previously locked tokens)
• Limited or uncertain token utility
• Market sentiment is overly optimistic
• Token has already reached the targets, be it price-wise, or development wise.

Below are examples from the ongoing cycle where a sell strategy appeared to work better:

Starknet ($STRK) - rewards up to $27,000

• All-Time High: $4.41 (Feb 20, 2024)
• All-Time Low: $0.182 (Feb 3, 2025)
• Total Decline (ATH to ATL): 95%
• Current Price: $0.22 (Feb 19, 2025)

The Starknet Foundation distributed over 700 million STRK tokens to nearly 1.3 million addresses. This allocation comes from a total of 1.8 billion STRK dedicated to the community. Starknet's price has depreciated since its launch in March 2024. The ATH price of $4.41 was reached on February 20, 2024, shortly after the airdrop. And the ATL of $0.182 occurred on February 3rd, 2025, representing a 95% loss. Starknet is a clear example where selling tokens immediately after receiving them benefited airdrop recipients. The reasons behind this price performance typically stem from multiple factors, ranging from poor tokenomics and community backlash to airdrop farming and unfavorable market conditions.

Altlayer ($ALT) - rewards up to $56,000

• All-Time High: $0.676 (Mar 28, 2024)
• All-Time Low: $0.043 (Feb 18, 2025)
• Total Decline (ATH to ATL): 94%
• Current Price: $0.045 (Feb 20, 2025)

Altlayer token experienced a dramatic decline since its peak in March 2024. Starting from an ATH of $0.676 to an ATL of $0.043. The constant downward trend suggests waning market interest and confidence in the project.

Wormhole ($W) - rewards up to $32,000

• All-Time High: $1.66 (Apr 3, 2024)
• All-Time Low: $0.1263 (Feb 25, 2025)
• Total Decline (ATH to ATL): 91%
• Current Price: $0.1263 (Feb 25, 2025)

The Wormhole airdrop distributed 678,823,000 $W tokens, representing 6.78% of the total supply, to over 40,000 qualified wallets. Despite initial optimism, the token's price trajectory has been consistently downward. From its ATH of $1.66 at launch during May 2024, $W tokens plummeted to $0.1263 by February 25th, 2025, representing a 91% loss for holders. Looking at the price chart, we can see a clear pattern of declining value with minimal recovery periods.

3. Staking Tokens

Staking involves locking your tokens to support network operations in exchange for rewards. This strategy can provide passive income while maintaining long-term exposure to the project.

Key Staking Considerations typically include:

• Lock-up periods and unstaking requirements
• Annual percentage yield (APY)
• Validator or pooling fees
• Smart contract risks

Examples of existing staking opportunities:

Hyperliquid ($HYPE) - Staking Opportunity

• APY: 2.15% - 2.26%
• Reward fee: 0 - 5%
• Unstake period: 8 days

For investors holding $HYPE tokens, the project continues to offer value beyond price appreciation through its staking program. The staking process on Hyperliquid is designed to be user-friendly. There’s no minimum requirement for the amount of $HYPE tokens you must stake. The rewards are sourced from future token emissions and tend to vary only slightly among different staking validators (2.15 - 2.26% annual percentage return).

You can follow the step-by-step tutorial on how to stake $HYPE in our Hyperliquid staking guide.

ZND ($ZND) - Staking Opportunity

• APY: 8.3% - 75.2%
• Reward fee: None
• Unstake period: Variable (based on the staking duration of choice)

ZND is a digital finance platform designed to make trading, earning, borrowing, and managing investments accessible and straightforward. After the ZND airdrop campaign yielded successful results, the users of the ZND platform can enhance their token utility via staking. The Staking Program lets you lock up your $ZND tokens to earn rewards. Users get flexible staking options, higher rewards for commitment, and a steady reward system.

Read our step-by-step tutorial on how to stake ZND.

Movement Labs ($MOVE) - Staking Opportunity

MOVE token launched at $0.64 and has experienced significant price volatility since. As of February 19th, 2025, the token trades at $0.4977, showing relatively neutral performance compared to other airdrops. This stability might indicate a more sustainable tokenomics model.

Hybrid approaches (partial sell/hold/stake)

A balanced approach often yields solid results. You might want to consider dividing your airdrop into portions:

• Immediate profit-taking
• Staking for passive income
• Holding for potential upside

Hybrid strategy helps manage risk while maintaining exposure to project growth. This strategy depends heavily on the airdrops' token utility. Projects that could apply for the hybrid approach include Movement Labs, Celestia, Ethena, and ZkSync.

Tax Considerations

Tax obligations for airdropped tokens depend on your jurisdiction. In some countries, tokens may be subject to tax upon receipt; staking or yield often counts as regular income. Some regions apply preferential rates to gains from longer holding periods. You should consult local guidance or a tax professional for clarity.

Recommended Market Analysis Tools & Websites

Track key metrics through platforms such as:

• DefiLlama for total value locked (TVL), protocol volumes, and overall health check of the protocol or project.
• Token Terminal for more in-depth analysis of projects.
• Linity for discovering airdrop opportunities, staking options, and relevant market insights.

Conclusion - There Is No “One-Size-Fits-All”

Every airdrop is unique, with its own tokenomics, market conditions, distribution methods, project roadmaps, and community dynamics. Historical trends from 2024–2025 demonstrate a wide range of outcomes:

Holding strategy seems to work when (Kaito, Hyperliquid, Story Protocol, ZND, Morpho):

• Project had significant traction and unique product market fit
• Strong token utility existed
• Project had clear vesting schedules
• Development progresses consistently
• Community engagement remained strong after the airdrop was distributed

Sell strategy worked when (Starknet, Altlayer, Wormhole, Taiko, Republik, Xai, Usual)

• The airdrop had high initial hype
• There was a large number of airdrop farmers who expected the airdrop
• The number of tokens was undetermined
• There was unclear utility

Hybrid strategy worked well when (Movement Labs, Celestia, Ethena, ZkSync):

• Staking rewards were introduced
• There were multiple profit-taking opportunities emerged based on the price appreciation
• Market sentiment was fluctuating dramatically