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Starknet’s STRK tokens plunged on launch on Feb. 20 amid criticism over the way the team’s managed the issuance of airdrop tokens and the schedule for their unlocking.
The altcoin’s price plummeted more than 57% over the past 24 hours to trade at $1.88 as of 5:50 a.m. EST on trading volume of more than $1.4 billion.
First Starknet Airdrop Distributes 782 Million Tokens
About 782 million tokens were distributed to around 1.3 million addresses with more than 100,000 wallets claiming more than 220 million STRK tokens as of Feb. 20, Starknet said on X.
Tokens are scheduled to be unlocked on a monthly basis for 31 months, starting from April. The criticism stems from a discovery that Starknet’s token generation event actually took place in November 2022, and that an an initial one-year vesting period was later pushed back to April this year.
That indicates that some 13% of the supply, with a value of more than $2.6 billion, could be unlocked in April, according to data from Token Unlocks.
Stealth launch token onchain, count it as TGE and release token 2 years later but count that as vesting start date.
We see a lot of shit in token land, but that has to be one of the sketchiest moves yet.
— Adam Cochran (adamscochran.eth) (@adamscochran) February 14, 2024
A vesting period typically begins after tokens are listed on exchanges or around the time of the launch, not 15 months earlier, says critics.
Starknet responded by saying that the arrangement was explained in its technical papers. And CEO Eli Ben-Sasson told Decrypt in an earlier interview that the deviation from industry practices for the STRK airdrop was a strength, not a weakness
Starkware is already trusted by users and does not need lengthy token locks, he said, adding that Starkware’s 150-employee base was committed to advancing the project.
The former professor at the Israel Institute of Technology in Haifa believes in rewarding investors and contributors early, saying there was no risk of his team taking advantage of the airdrop structure.
But critics suggest there was a lack of clarity around the event that smacks of insider benefits.
“1 of the most cynical, rug-pull token drops in the history of crypto,” tweeted Alex Pruden, CEO at Aleo, a privacy-first Layer-1 blockchain, on X. “Is this a third tier shitcoin? No, it’s a first-tier project backed by @paradigm & others who are about to get rich off the backs of unsuspecting investors.”
Buyers of $STRK beware, you are the exit liquidity.
1 of the most cynical, rug-pull token drops in the history of crypto. Is this a third tier shitcoin? No, it’s a first-tier project backed by @paradigm & others who are about to get rich off the backs of unsuspecting investors https://t.co/HHdgqeP0rD
— Alex Pruden (@apruden08) February 15, 2024
New Solana Meme Coin Airdrop Has Everyone’s Attention
While controversy clouds the STRK airdrop, the new Solana meme coin Smog is promising to unleash the biggest airdrop in history soon. The altcoin surged more than 24% over the past week, and its community on social platforms surpassed 55k.
Although no specific details about the airdrop event have been released yet, the project’s tokenomics shows that 35% of the crypto’s supply has been set aside for airdrop events.
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