TL;DR
- Sophon dropped 27.9% on its first trading day following a 900 million token airdrop and a wave of profit-taking.
- Binance assigned it a “seed tag” and enabled futures trading with up to 75x leverage, fueling speculation and volatility.
- Another 20% of the total supply will unlock in three months; without new use cases, it could increase downward pressure in the market.
Sophon, the new utility token for the Layer 2 network running on zkSync, saw a sharp drop after its official launch.
In the first 24 hours of trading, the token lost 27.9% of its value, falling from an initial high of $0.11 to $0.05819. The decline followed a massive airdrop of 900 million tokens, equal to 9% of its total 10 billion supply, distributed to early contributors, zkSync users, and NFT holders.
The airdrop, aimed at attracting attention and providing initial liquidity, triggered rapid profit-taking. The excess supply, combined with the token’s limited utility at this stage, created a supply-demand imbalance that the market struggled to absorb. Binance assigned Sophon a “seed tag,” a label that identifies high-risk, highly volatile assets, and opened futures trading with leverage of up to 75x. This encouraged speculative activity, which amplified the volatility.
Sophon Plans Another Airdrop With 20% of Its Supply
Despite the sharp drop, on-chain metrics show rising activity. According to DefiLlama, the total value locked on the network reached $20.28 million, a 14.1% increase from the previous day. DEX trading volume surpassed $47.44 million, driven by high token turnover following the airdrop and trading launches on exchanges like OKX, KuCoin, Upbit, Bitget, and MEXC, all of which listed Sophon on the same day.
The Sophon network uses Validium technology and is part of the zkSync Elastic Chain roadmap. While its current utility is limited to covering gas fees and contributing to sequencer decentralization, the project has raised over $70 million and plans to add more functions for entertainment apps and decentralized tools.
In three months, a new unlock of 20% of the total supply will begin, intended for node rewards. If the network doesn’t expand its use cases before then, the market could face additional selling pressure. The project still carries high growth expectations, though its early performance has been shaped by speculation and oversupply
