As Monad prepares for its highly anticipated $MON token launch on Coinbase, the project is facing intense scrutiny over its tokenomics and recent controversies. Despite transparency in market maker operations, the Ethereum rival appears to be struggling with community trust issues that could impact its debut.
Monad has made headlines by publicly disclosing its entire market maker loan structure—an unprecedented move in the crypto space. The project revealed loans of 160 million $MON tokens to five top-tier firms: CyantArb (50M), Auros (30M), Galaxy (30M), GSR (30M), and Wintermute (20M). While this transparency is commendable, it represents just 0.16% of Monad’s 100 billion total supply, raising questions about the overall impact on liquidity.
The loans come with varying terms—four firms have one-month renewable arrangements, while Wintermute secured a 12-month deal. This approach aims to seed liquidity on decentralised exchanges rather than relying solely on centralised platforms, but the strategy carries its own risks.
Tokenomics Under Fire
The most significant criticism surrounds Monad’s token distribution. Community members have pointed out that only 10.8% of the total supply is available to retail users through a 3.3% airdrop and 7.5% public sale, while over 50% is allocated to insiders and ecosystem funds. This centralisation contrasts sharply with the project’s decentralised messaging.
The situation is exacerbated by the fully unlocked ecosystem development portion (38.5%), which lacks clear allocation guidelines. While team and investor allocations are locked for a year, the immediate availability of such a significant portion raises concerns about potential market impact.
aPriori Airdrop Scandal Taints Ecosystem
Adding to Monad’s woes, its flagship liquid staking protocol aPriori has been implicated in what analysts describe as “one of crypto’s most blatant insider airdrops”. On-chain data reveals that 14,000 newly created wallets claimed 60% of the total airdrop allocation in late October.
These wallets followed an identical pattern: claiming tokens, dumping them immediately, and going silent. The resulting market impact was devastating—$APR’s market capitalisation crashed from $300 million to approximately $57 million within weeks. What makes this particularly damaging for Monad is that aPriori was designed to handle $MON staking when the mainnet goes live. The protocol’s $30 million funding and status as a Day-1 application now seem compromised.
The Transparency Paradox
As Monad approaches its November 17 token sale at $0.025 per token (with a $2.5 billion FDV), investors face a complex risk-reward calculation. The project boasts impressive technical specifications—10,000 TPS, sub-second finality, and full EVM compatibility – but these fundamentals are overshadowed by governance and distribution concerns.
Public sale buyers who gained access at $0.025 could potentially become exit liquidity for market makers if loans aren’t renewed. With Coinbase discouraging token sales within 30 days of purchase, investors face additional constraints on their exit strategies.
Monad’s launch represents a critical test for the crypto industry’s evolution. The project’s transparency in market maker operations sets a positive precedent, but without addressing fundamental centralisation concerns, it risks becoming merely good PR rather than genuine innovation.
As the mainnet launch approaches on November 24, all eyes will be on whether Monad can navigate these controversies or whether competing chains will capitalise on its missteps. For now, the project serves as a reminder that transparency, while valuable, cannot substitute for truly decentralised token distribution and ecosystem development