Berachain’s “proof of liquidity” model is under fire as initial investors have cash out, leading to a 63% decline from its launch.
High anticipated layer -1 blockchain, Berachain (Bera) officially launched its mennet on 6 February, introducing an ambitious “proof of liquidity” mechanism and one of the largest aircrafts of the year.
Berachain’s origin is the Bong Beer NFT Collection, a canbis-theme project launched in 2021.
Major exchanges, including Binance, Mexc, Upbit, and Bithumb, quickly listed Bera, fueling the enthusiasm around their ecosystem.
As as 11 February, Project reached A few days after its launch, the total value of $ 3.1 billion closed, which is one of the most discussed blockchain launch in recent months.
However, concerns over its aircraft allocation, tokenomics and insider trading activity have overshraded early publicity.
Users participating in BERACHAN’s Testnet expressed disappointment, claiming that they received less than expected bera tokens.
When analysts highlighted deep issues in the structure of tokens, the disappointment intensified how early investors and interiors were benefiting from the network stacking mechanics.
The blockchain of the berachain is built around three interacted tokens -BERA, BGT, and honey -each performs different functions.
Critics argue that private investors, who hold more than 35% of the total bera supply, can share bera, earn BGT, can burn BGT for additional bera, and sell it, a potential Flaws can be created that allows early backers to remove liquid while regular tolerates regular holders. negative side.
“Wait, can the inner formula can cycle through token mechanics and dump on retail? It could not be real, ”a disappointed businessman commented.
Connecting the controversy, data shows that one of the core developers of Berachain, known as “Devbear”, received 200,000 Bera from Aircraft and some parts of it shortly after the launch. Sold.
“A co-founder selling tokens immediately after the launch? This is not a great look, “an observer stated, raising concerns that the interiors were closing their allocation, while the broad market absorbed the sale pressure.
As this revelation spread, the price of Bera, which reached a high of $ 14.99 on 6 February, increased from 63% to $ 5.57 on 11 February.
While instability in the newly launched tokens is common, the rapid decline raises the question whether the pre-launch promotion of Berachain was durable or if the structure of the token naturally benefits internal formulas than retail participants.
