Starknet Token Faces Massive Drop as Nethermind and Airdrop Farmers Sell Off
Summary:
Starknet's token for the Ethereum layer-2 network experienced a drastic drop in value of over 60% within two days of its launch, largely due to significant sell-offs from Ethereum infrastructure firm Nethermind and airdrop farmers. Data analysis revealed instances of airdrop hunters consolidating significant amounts of tokens into one address. In the face of these challenges, Starknet’s overall locked value stands at $73.5 million, noting a nearly 30% rise in 24 hours.
Emerging just two days ago, Starknet's token for the Ethereum layer-2 network took a severe hit, plummeting by more than half in its value after Nethermind, an Ethereum infrastructure provider, alongside airdrop farmers, disposed of millions of the distributed tokens. CoinGecko data indicates that Starknet’s (STRK) value suffered a 60% dip, dropping below $1.90 from its initial $4.41 during the Feb. 20 airdrop to some blockchain users. STRK peaked to $7.70 following its debut on Binance, which has since dipped under $1.90, a staggering 75% fall. Blockchain analysts Lookonchain, on Feb. 22, observed that STRK’s value has consistently dipped since its inception, with Nethermind offloading 3.41 million STRK valued at over $6.7 million, fear of further selling was suggested as Nethermind still retains over $12 million worth of the token.
Around the same time, Lookonchain detected another instance of a STRK airdrop hunter gathering tokens from multiple wallets, amassing 1.2 million STRK worth $2.4 million from close to 1,800 distinctive wallets into a single one. A similar incident of hunters consolidating about 1.4 million airdropped STRK valued around $3 million into one address from almost 1,400 wallets was detected by Lookonchain on Feb. 21.
Ahead of Starknet’s airdrop, allegations surfaced from Yearn.finance developer Banteg who noted that over 700,000 wallets eligible for the STRK airdrop were connected to GitHub accounts, controlled by airdrop hunters. Starknet’s users meanwhile raised objections of disqualification from the STRK airdrop, despite executing transactions worth thousands of dollars. The criteria required one to hold at least 0.005 Ether (ETH), approximated to $10, at the time of the snapshot on Nov. 15, 2023.
In addition, concerns were put forth regarding STRK’s unlock scheme aimed at rewarding Starknet investors and contributors with 1.3 billion STRK, 13% of the supply, approximately two months post-launch. Broad acceptance was witnessed during STRK’s airdrop launch, securing 45 million STRK tokens within the first ninety minutes. Currently, as per Voyager data, near 430 million STRK tokens accounting for 92% of the total designated for distribution and a value of over $790 million have been acknowledged by eligible recipients.
In the face of these challenges, Starknet’s overall locked value stands currently at $73.5 million, showing a near 30% rise within 24 hours, according to DefiLlama.
Published At
2/22/2024 9:17:58 AM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.