Starknet’s native token, STRK, experienced a significant drop in value, losing 55% of its worth within 24 hours of being listed for trading on Tuesday. The trading volume exceeded $1.2 billion, with minimal liquidation of STRK futures, indicating that the majority of selling pressure came from spot trading.

The token’s distribution strategy saw 728 million STRK allocated to approximately 1.3 million addresses based on specific criteria, leading to a substantial sell-off by recipients. Over 100,000 wallets claimed more than 220 million STRK by Tuesday.

Starknet is known for its Ethereum rollup platform, which utilizes zero-knowledge proof technology to enhance scalability while maintaining data privacy. Despite this innovative approach, the token’s value decline has raised concerns within the crypto community.

A significant portion of STRK’s supply, 50.1%, was reserved for the Starknet Foundation for community initiatives, while 24.68% was earmarked for early contributors and investors. Additionally, 32% was allocated to StarkWare’s employees, consultants, and developer partners.

The token’s unlocking schedule, set to begin in April and last for 31 months, has faced criticism. Critics argue that the token’s initial generation event in November 2022, with a vesting period extending to April 2024, was not transparently communicated to the market. This has raised concerns about potential benefits to insiders at the expense of the wider community.

While Starknet developers maintain that the token generation event was documented in technical papers, critics believe it was obscured from public awareness. The unlocking of tokens for core contributors and investors, starting in April 2024, could lead to a significant supply influx, potentially impacting the token’s value.

Despite the criticism, Starknet has not altered its vesting schedule as of Wednesday. The market will closely monitor developments to see how Starknet addresses these concerns moving forward.