KAITO's ecosystem expansion faces a crisis of confidence: frequent underperformance of new projects raises questions.
TL;DR
The KAITO ecosystem faced a severe test of trust between September and October 2025, with 80% of new projects experiencing significant drops in value after launch. Projects like Novastro saw their prices fall by 72% from their initial offering price, prompting the community to question the platform's project selection mechanisms and transparency, resulting in a significant decline in ecosystem participation.
Core Analysis
The new project performed poorly.
Statistics on projects that broke their issue price :
| Project Name | Tokens | Issue price | Current Price | Decline | ATH decline |
|---|---|---|---|---|---|
| Novastro | XNL | $0.05 | $0.014 | -72% | -59% |
| Everlyn | LYN | ~$0.10 | $0.105 | -13% | -83% |
| HANA Network | HANA | ~$0.04 | $0.040 | -3% | -84% |
| Boundless | ZKC | $0.29 | $0.217 | -25% | -88% |
| Limitless | LMTS | $0.05 | $0.349 | +598% | -27% |
Key issues :
- Immediate selling pressure : 4/5 of the projects experienced a drop of over 70% after TGE, mainly due to the supply shock caused by the unlocking of 100% or 50% of the tokens .
- Post-hype consequences : Novastro was 235% oversubscribed, but its stock price plummeted 44% at the open, subsequently continuing to fall to -72%.
- Sector rotation impact : The AI/RWA sector experienced an overall correction of 20-30% in October, exacerbating the selling pressure on individual projects.
On-chain data shows a decline in ecosystem activity.
Deterioration in participation metrics :
- Transfer activity : down 34% in October compared to September (413,699 vs 624,410 transactions).
- Number of traders : Daily active traders decreased by 6% (343 vs 363).
- Staking Stagnation : sKAITO staking contracts saw zero net inflows, indicating low user engagement.
Impact of the unlock event :
- Trading volume surged to $8.1 million between September 27 and 29, suspected to be related to the monthly unlocking event.
- The high concentration of holdings, with the top two addresses controlling approximately 55% of the supply, amplifies the impact of sell-offs.
Community trust crisis erupts
Transparency Controversy :
- The MemeX incident : The promised $700,000 in token rewards failed to be delivered to English-language creators, and the funds were transferred to Chinese KOLs, leading the community to accuse it of "fraud." x.com
- Insider trading allegations : Multiple projects have been accused of insider selling; Novastro investors, after losing $11,500, publicly demand the platform be held accountable . (x.com)
Flaws in the project screening mechanism :
- Three consecutive projects exhibiting a similar pattern of "oversubscription - rapid unlocking - price crash" raises questions about KAITO's prioritization of trading volume over sustainability.
- Genesis NFT's price plummeted 75% immediately after the token snapshot, further damaging the platform's reputation .
Technical indicators confirm bearish sentiment
KAITO token performance :
- Current price : $1.05, down 64% from ATH $2.92
- Technical indicators : RSI 43.4 (neutral to bearish), MACD negative, price has broken below all major moving averages.
- Derivatives Market : Funding rates are negative (-0.009% to -0.026%), with long positions paying fees to short positions, reflecting bearish market sentiment.
Unlocking pressure persists : Historical data shows that each unlocking event (such as the unlocking of 21.8M tokens in August) is accompanied by a 10-15% price pullback, and the unlocking of 8.35M tokens on October 20th continues to put pressure on coinmarketcap .
in conclusion
The KAITO ecosystem, during its rapid expansion, has exposed problems such as lax project selection criteria, insufficient transparency, and flawed token economics design. The dismal performance of 80% of new projects has not only damaged investor confidence but also threatened the platform's long-term reputation. To rebuild trust, KAITO needs to strengthen project due diligence, improve distribution transparency, and optimize the unlocking schedule to reduce market shocks.