Celestia's TIA Token Surges 200% Post-Launch Amidst Limited On-Chain Activity

In the 13 days since its launch, Celestia, a newly-established modular blockchain, has encountered a subdued on-chain activity, recording just 160,000 transactions. Despite this slow start, the native TIA token has witnessed a remarkable surge, reaching $6.30—a 200% increase from its initial value of around $2.10 two weeks ago. This surge, however, does not align with a corresponding rise in blockchain utilization.

Although Celestia processed 350,000 transactions in the first two days post-launch, it has only added an additional 160,000 transactions since then, according to MintScan. In comparison, rival modular blockchain Arbitrum has maintained an average of 550,000 to 920,000 daily transactions over the past seven days, as per Arbiscan data.

Transactions per second (TPS) offer another perspective on blockchain scalability. Currently, Celestia registers at 0.13 TPS, while Arbitrum boasts a daily average of 8.01 TPS, according to L2Beat. It's essential to consider that Celestia is still in its early stages, having launched just two weeks ago. Its adoption is not anticipated to match that of Arbitrum, operational since May 2021. However, Celestia now faces competition from industry heavyweights like NEAR, vying to provide data availability services to Ethereum rollups.

Data availability is a crucial aspect, enabling network nodes to download, store, and make transaction information accessible for verification. Sean Farrell, a crypto analyst at FundStat, highlighted this functionality in a note earlier this month.

Despite a modest demand for its data availability feature, Celestia's tokenomics have captured the attention of traders. Only 141 million tokens out of the 1 billion hard cap are currently circulating, with the majority locked up until October 2024 and October 2026. The trading volume for TIA in the past 24 hours exceeds $900 million, surpassing the market cap of all circulating tokens, according to CoinMarketCap.

This rally in token value draws parallels with Aptos, which experienced a similar trajectory after its APT token airdrop launch last year. Despite a total value locked (TVL) on the blockchain of just $50 million at the time, APT reached a market cap of $2.9 billion.

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