The native token for Mode, a new layer 2 blockchain network that is part of Optimism’s Superchain ecosystem, dropped in price immediately after its airdrop claims went live, a potential sign that airdrops are losing their shine. 

MODE, which will be used to govern the protocol, started trading above 14 cents around 7 a.m. ET, but in the past seven hours, the cryptocurrency has since dropped over 63% to 5 cents as of presstime, according to data from CoinGecko

MODE’s market cap sits at around $71 million, while its fully diluted valuation (FDV), which is the theoretical market cap of the token if its entire supply was in circulation, stands at $547 million, less than rival layer 2 blockchain networks such as Base, Manta, Arbitrum, Mantle, and Starknet. 

Read more: Top 10 Crypto Projects With Points Programs That Haven’t Held Airdrops Yet

MODE’s price action following its token genesis event is not the first time a new cryptocurrency has seen its price fall shortly after its airdrop claim went live. The native tokens for Kamino, Renzo, Parcl, Wormhole, and Friend.Tech – which have all recently conducted their token genesis events – have not only slid in price within 24 hours of their airdrop date, but also remain lower than the first day they started trading, per CoinGecko. 

One crypto user, who goes by @TobiWebIII on X, noticed how MODE is trading under 7 cents and wrote, “Are we witnessing the inevitable end of the airdrops?” Another user, with the screen name @OlimpioCrypto on X, noted that Mode’s FDV was low, commenting how “we are starting to see there’s not infinite money for infinite valuations for infinite L2s.”

Read more: Who Knew Throwing Tantrums Would Be Such an Effective Strategy to Receive a Larger Airdrop Allocation?

Early adopters of Mode have locked $488.36 million in total value within the layer 2 network, making it the 15th-largest blockchain by TVL. However, of the 11 protocols that each have a TVL exceeding $2 million on Mode, all but one have seen their TVL drop in the past 24 hours, DefiLlama’s data shows

In Jan. 2024, the Optimism Foundation awarded Mode a grant of two million OP tokens, worth about $5.4 million, to incentivize user growth on Mode’s network.