Berachain’s Market Frenzy Cools as Airdrop Controversy and Insider Trading Mount
Berachain’s “Proof of Liquidity” model is under fire, because the first investors envelop, triggering a drop in prices of 63% compared to its high launch.
Berain (He), the highly anticipated layer 1 Blockchain, officially launched his Mainnet On February 6, introducing an ambitious “proof of liquidity” mechanism and one of the largest parachutists of the year.
The origins of Berachain date back to the Bong Bears Nft collection, a project on the theme of cannabis which was launched in 2021.
The main exchanges, including Binance, Mexc, Upbit and Bithumb, quickly listed Bera, fueling excitation around its ecosystem.
As of February 11, the project reached A total locked value of $ 3.1 billion only a few days after its launch, making it one of the most discussed blockchain launches in recent months.
However, concerns about its airlines, tokenomics and initiate negotiation activities overshadowed the initial media threw.
Users who participated in the Berachain Testnet expressed their disappointment, saying that they had received much fewer Bera tokens than expected.
The frustrations have intensified when analysts revealed deeper problems in the structure of the token, in particular the way in which the first investors and initiates benefited from the mechanics of the network.
Berachain’s blockchain is built around three interconnected tokens – Bera, BGT and honey – each serving as distinct functions.
Critics argue that private investors, who hold more than 35% of the total of Bera’s offer, can reach Bera, win BGT, burn BGT for additional Bera and sell it, creating a potential escape which allows the first donors of Fund to extract liquidity while regular holders carry the drawback.
“Wait, so that initiates can browse the token mechanisms and empty the retail?” It cannot be real, ”said a frustrated merchant.
Adding to the controversy, the data suggest that one of the main developers of Berachain, known as “Devbear”, received 200,000 Bera from Airdrop and sold parts of it shortly after the launch.
“A co-founder selling tokens immediately after the launch? It is not a big look, “said an observer, which raises concerns that initiates discharged their allowances while the wider market absorbed the sale pressure.
While these revelations were spreading, Bera’s price, which reached a summit of $ 14.99 on February 6, dropped from $ 63% to February 11.
Although volatility is common in newly launched tokens, the rapid decline raises the question of whether the Berachain pre-launching media is durable or if the structure of the token intrinsically benefits the initiates more than participants in retail.
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