1inch Team Promises Tokenomics Overhaul After 1INCH Plummets to Record Low
The multi‑chain DEX‑aggregator’s native token fell to $0.112 on Jan. 28, a drop tied to large‑scale sales from early‑investor wallets. In response, the project announced a comprehensive review of its tokenomics.
What happened?
During the last week of January the price of the 1INCH token slid roughly 20 %, sinking to an all‑time low of $0.112 on Wednesday, Jan. 28. The sudden depreciation coincided with on‑chain activity that showed several wallets—identified by the community as likely belonging to early investors—offloading millions of dollars worth of 1INCH, primarily through the CoW Swap aggregator. Analysts estimate that more than $6.5 million was realized from those sales.
The sell‑off sparked a cascade of price pressure, sending the token into a steep decline that erased a sizeable portion of its market cap within 48 hours.
1inch’s response
In a post on X (formerly Twitter) on Jan. 28, the 1inch team clarified that the transactions did not involve wallets controlled by the core development team, the company’s treasury, or any of its multisig signers. The statement read:
“No 1INCH was transferred from addresses owned or managed by 1inch entities, our team, or treasury multisigs.”
The firm added that it will undertake a tokenomics review during the current year, aiming to reinforce the token’s resilience in bearish market conditions and periods of thin liquidity. No further specifics were disclosed, and a spokesperson declined additional comment beyond the published statement.
Why the sell‑pressure matters
- Liquidity strain: Large, coordinated outflows from vesting or early‑investor wallets can overwhelm thin order books, especially for tokens that rely on decentralized aggregators for trade execution.
- Market confidence: When investors see sizable holdings being liquidated, it can trigger panic selling among retail holders, amplifying price declines.
- Governance implications: The token’s utility in protocol governance and incentive mechanisms means that a depressed price may affect participation rates and the perceived value of voting power.
Potential focus areas for the tokenomics review
While 1inch has not detailed its roadmap, industry best practices suggest the following avenues could be explored:
| Area | Possible actions |
|---|---|
| Vesting schedules | Extend lock‑up periods for private‑sale and team allocations; introduce staggered release cliffs. |
| Supply dynamics | Implement burn mechanisms tied to protocol usage (e.g., swap fees) to create deflationary pressure. |
| Liquidity incentives | Reconfigure liquidity mining rewards to favor long‑term stakers rather than short‑term profit takers. |
| Governance resilience | Raise quorum thresholds or introduce delegation caps to prevent concentration of voting power. |
Key takeaways
- Early‑investor sales triggered a sharp price collapse, pushing 1INCH to a new low of $0.112.
- The 1inch team denied involvement in the sell‑off and announced a tokenomics review aimed at bolstering the token’s stability.
- Future adjustments may target vesting terms, supply controls, and incentive structures to mitigate similar sell‑pressure events.
- Market participants should monitor upcoming announcements for concrete policy changes, as they will likely influence both token price and governance dynamics.
The coming months will be crucial for 1inch as it seeks to restore confidence among its community and reinforce the economic foundations of its native token. Stakeholders are advised to stay tuned to official communications for detailed rollout plans.
Source: https://thedefiant.io/news/markets/1inch-team-responds-to-1inch-investor-sales
