Spark Token Continues to Decline Following Airdrop Launch
The Spark token saw a significant drop in price on Wednesday, June 18, just one day after its highly anticipated airdrop launch.
The value of Spark (SPK) plummeted to $0.0470, marking a 30% decrease from its previous high. Despite this decline, the token experienced a surge in trading volume, reaching over $378 million within 24 hours. This volume far exceeded its market capitalization of $83 million, leading to an increase in its fully diluted valuation.
Despite the price crash, Spark’s ecosystem continued to demonstrate strength. DeFi Llama reported a record high total value locked in the network, surpassing $6.66 billion compared to $6.48 billion in April.
Spark offers on-chain capital allocation services, leveraging Sky Protocol (SKY) for borrowing and allocating capital across various sectors such as decentralized finance, centralized finance, and real-world assets. Users can also deposit stablecoins to earn returns, with the platform boasting a savings TVL of $3.29 billion and an average savings rate of 4.50%. Additionally, users have the option to borrow USDS and USDS+ against their liquid assets.
Factors Contributing to Spark’s Price Decline
Despite being listed on major exchanges like Binance, Coinbase, Bybit, OKX, and Bitget, Spark token experienced a decline in price. Some platforms even offered incentives to attract investors, with OKX providing a $100,000 reward for users depositing USDC into the Spark USDC Savings Vault.
The overall downturn in the crypto market also played a role in Spark’s price drop, affecting not only Bitcoin but also most altcoins. Tokens like Virtuals Protocol, Dogwifhat, and Kaspa all saw significant declines of over 10%.
Another contributing factor to Spark’s price decrease is the anticipated token unlocks. With a circulating supply of 1.7 billion tokens and a maximum supply of 10 billion, the release of 8.3 billion tokens over the coming years is expected to increase the overall supply significantly.
It is common for newly listed tokens to experience initial price drops as airdrop recipients begin selling. Similar tokens like ZKsync and Berachain also saw fluctuations in their early days before rebounding to higher prices. This suggests that Spark’s token may recover in the near future.