Monad, the upcoming layer-1 project, will launch its mainnet on Monday after concluding its presale on Coinbase, the biggest crypto exchange company in the United States. This article explores some of the top reasons why the MON price will crash after the airdrop and exchange listings.
Monad Price to Drop Because of the Ongoing Crypto Market Crash
One potential reason why the Monad coin will crash after the airdrop is that it is happening at a time when there is a crypto market crash that has affected all coins, including popular blue-chip names like Ethereum, Bitcoin, and Solana.
Not many coins have been spared, with the market capitalization of all coins plunging by double digits in the past few weeks and the market capitalization of the industry falling by over $1.2 trillion.
The ongoing crypto market crash has led to fear among investors, with the Crypto Fear and Greed Index plunging to the lowest level this year. Crypto ETF outflows have also jumped.
Therefore, launching a token in this market conditions is risky. Indeed, in most cases, companies always postpone their initial public offerings (IPO) whenever the stock market is not doing well.
READ MORE: XRP Price Reaches Pivotal Support as ETFs Near a $500M Milestone
Recent New Tokens Always Crash After the Airdrop
The Monad price will likely crash as other crypto tokens have done in the past. A closer look at the most recent token launches shows that most of them have plunged by double digits and are now hovering at their all-time lows.
For example, Keeta price has crashed to $0.30, down 85% from its highest level after the airdrop. This crash is notable because Keeta, which is backed by Eric Schmidt, promised the same things that Monad has promised, including lightning-fast speeds and EVM compatibility.
Similarly, World Liberty Financial (WLFI) token has crashed by 54% from its highest point after the token launch.
Somnia, whose token surged after its airdrop, has also plunged to a record low, erasing millions of dollars in value.
One reason why layer-2 and layer-1 networks crash after their airdrops is that many insiders always sell to book profits. Also, these insiders are intelligent people who have seen other tokens crash over time.
Also, there is currently an oversupply of layer-2 and layer-1 networks in the crypto industry. And despite all this, data shows that none of them is coming close to beating Ethereum, which maintains a substantial market share across most industries.
Most MON Tokens are Going to Insiders
The other main reason why the Monad price will likely crash after its airdrop is that most of its tokens will go towards its insiders.
According to its tokenomics, the team will receive 27% of the allocation, while its investors will receive 20%. Category Labs Treasury, which is controlled by the team, will receive 4% of the tokens.
The public receives just 7.5% of the tokens. In most cases, airdrops with so much insider concentration don’t do well. Two good examples are the Trump Meme Coin and the WLFI token.
READ MORE: XRP Price Reaches Pivotal Support as ETFs Near a $500M Milestone
