The recent debut of the Ethereum layer-2 network Starknet’s token has been tumultuous, with its value plummeting by over 60% within two days.
Initially airdropped to certain users on February 20, the Starknet token (STRK) experienced a sharp decline from its peak of $4.41 to less than $1.90, as reported by CoinGecko.
Although listed on Binance and briefly soaring to $7.70, the token’s value swiftly nosedived by 75.4% to below $1.90. Blockchain analysts at Lookonchain observed this downward trend, noting, “The price of $STRK has been falling since its launch.”
They identified significant sell-offs by Nethermind, an Ethereum infrastructure firm, which offloaded 3.41 million STRK, equivalent to over $6.7 million.
Concerningly, Lookonchain warned that further selling might occur, given Nethermind’s remaining stash valued at over $12 million.
In a separate revelation, Lookonchain disclosed a consolidation of STRK holdings by an airdrop participant, consolidating 1.2 million STRK, worth $2.4 million, from approximately 1,800 wallets into a single address.
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This followed a similar occurrence the previous day, involving 1.4 million STRK from around 1,400 wallets.
Allegations surfaced prior to the airdrop by Yearn.finance developer Banteg, suggesting that a significant portion of eligible wallets were associated with GitHub accounts controlled by airdrop hunters.
Furthermore, dissatisfaction arose among Starknet users who claimed ineligibility for the distribution despite substantial transaction activity.
Eligibility criteria demanded a minimum holding of 0.005 Ether (approximately $10) at a snapshot on November 15, 2023.
Criticism extended to STRK’s unlocking schedule, designed to allocate 1.3 billion tokens, equivalent to 13% of the total supply, to Starknet investors and contributors approximately two months post-launch.
Despite the token’s depreciating value, Starknet’s total locked value surged by nearly 30% within 24 hours to $73.5 million, as per DefiLlama.
The airdrop initially garnered significant interest, with 45 million STRK tokens claimed within the first 90 minutes, amounting to 92% of the total distribution value exceeding $790 million, according to Voyager’s data.
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