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HomeNewsNewsStarknet token Bloodbath: 50% Price Crash Blamed on Airdrop Abuse and Dumping

Starknet token Bloodbath: 50% Price Crash Blamed on Airdrop Abuse and Dumping

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Starknet token price has been halved amidst accusations of a Sybil attack and coordinated sell-offs following its recent airdrop. Explore the potential causes and implications of this dramatic price drop.

Due to the airdropping of millions of dollars worth of tokens by Ethereum infrastructure firm Nethermind and airdrop farmers, the value of the two-day-old currency of the Ethereum layer-2 network Starknet has more than halved.

According to CoinGecko data, the price of Starknet token (STRK) has decreased by almost 60% and is currently trading around $1.90 from a peak of $4.41 on February 20 when it was airdropped to certain blockchain users.

After debuting on the market, Starknet token price on Binance reached as high as $7.70; however, it has since fallen 75.4% to less than $1.90.

Image Source : CoinGecko

“The price of $STRK has been falling since its launch,” blockchain analysts Lookonchain wrote in a Feb. 22 X post

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Additionally, it revealed that Nethermind had sold 3.41 million STRK for more than $6.7 million and issued a warning that “the selling may continue” because the company still possessed over $12 million worth of STRK.

A few hours prior, Lookonchain announced that it had discovered a second case of a STRK airdrop hunter combining accounts. over 1.2 million Starknet tokens, valued at $2.4 million, were transferred from over 1,800 distinct wallets to a single address.

A similar case of an airdrop hunter was discovered on February 21, according to Lookonchain, with about 1,400 wallets sending 1.4 million airdropped STRK, or almost $3 million, to a single address.

Before Starknet’s airdrop, Yearn. finance developer Banteg said that more than 700,000 wallets out of the 1.3 million that could be airdropped with STRK were connected to GitHub accounts owned by airdrop hunters.

Starknet users who claimed they were not eligible for the distributions despite transacting thousands of dollars also dented the STRK airdrop. To be eligible, users had to own a minimum of 0.005 Ether (ETH) Dollar signs down $3,017 – around $10 — at the time of the Nov. 15, 2023

Others objected to the STRK unlock schedule, which around two months after debut rewards Starknet donors and investors with 1.3 billion STRK, or 13% of the supply.

When the STRK airdrop went live, it was extremely popular; 45 million STRK tokens were claimed in the first 1.5 hours of the allocation process.

Despite STRK’s price drop, Starknet’s total value locked is $73.5 million — a nearly 30% jump in 24 hours, according to DefiLlama.

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