Celestia, the modular blockchain that claims to be scalable without sacrificing security, launched in late October 2023 after weeks of anticipation from the broader crypto community. However, hours after launching and TIA listing on multiple exchanges, including OKX and KuCoin, the coin is struggling to match the initial enthusiasm.
TIA Is Dropping, Blame The Celestia Airdrop?
The coin is down 20% from recent highs and risks plunging some more. Reportedly, some airdrop recipients, chiefly Sybil groups, are liquidating the coin via mainstream exchanges. This is heaping more pressure on bulls.
These recipients, according to Celestia, were early adopters of the project. In total, the platform allocated 60 million TIA for the airdrop, representing 6% of the total supply.
Usually, crypto projects distribute free tokens in an airdrop as a strategy to raise awareness. To receive tokens, interested users must provide their wallet addresses and actively participate as a developer or a platform user. In Celestia’s case, for example, the network distributed TIA, to among others, developers.
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In total, 191,391 addresses are set to receive TIA from the airdrop. However, according to a recent report, at least 20% of these addresses are controlled by Sybil groups. By November 1, 138,981 addresses, representing 72% of all accounts, had already claimed roughly 44 million TIA out of the 60 million set aside for the airdrop.
Sybil Group Operators Reaping Big, Dumping TIA
That Sybil groups manipulated their way and received TIA could, according to researchers, suppress prices going forward. Technically, a Sybil group of malicious actors who create multiple fake identities aiming to take control of a given network, in this case, Celestia, or even destabilize the airdrop. Through the numerous fake identities created to receive the TIA airdrop, researchers discovered that Sybil group operators deposited to a single address before moving them to a crypto exchange.
The report notes that large-scale Sybil groups, which operate over 20 deposit addresses, received 5.22 million TIA. Meanwhile, large Sybil groups operating between five to 20 addresses ended up with 6.65 million TIA. At the same time, 51,494 addresses were suspected to be part of the Sybil group ring that received 17.05 million TIA.
Out of this, researchers discovered that one profitable Sybil group, operating 300 airdrop addresses, received 77,391 TIA. Coins deposited to the 300 airdrop addresses were consolidated to one address and sent to OKX. Surprisingly, each of the 300 addresses ended up with 258 TIA, meaning Celestia didn’t notice they were associated and possibly operated by one entity.
Feature image from Canva, chart from TradingView