On July 27, 2020, Ethereum-based DeFi protocol mStable, which launched its token Meta (MTA) on July 18, 2020, has surged above 47% in the last 24 hours.
The hype surrounding the MTA token launch was massive, and within an hour of the release, the DeFi token traded at 16x its original value at $0.15.
This meant that MTA investors received 1,000% of their initial investment, with the token’s value rising even higher in the subsequent days.
These remarkable returns caught the attention of Messari researcher Ryan Watkins who noted that MTA was released with a new procedure known as an initial decentralized exchange offering (IDO).
Watkins explained on twitter that MTA is now trading at 16x its $0.15 seed price, with the fear of missing out amongst investors driving the price up far higher than any other IDO so far.
ETH’s DeFi Sector Sees Exponential Growth
While impressive, MTA’s recent upsurge is far from unique. The LEND token, which is the native coin of the Aave DeFi protocol, also gained more than 1,500% over the last year, making it one of the most lucrative investments of 2020.
More recently, Maker (MKR) went through a considerable bullish impulse that saw it rise over 23%. The value of this DeFi token surged from about $488 to reach a high of $600.
The explosive performance of MKR and other DeFi tokens mentioned above has coincided with the exponential growth of Ethereum’s DeFi sector. Ethereum’s DeFi blockchain exceeds a total value of $2 bln.
mStable Backtracks on Early Token Drop
The mStable project found itself in trouble on July 21, after being accused of rolling out an unannounced token drop.
DAO Maker tweeted that the mStable team airdropped over 3.1M MTA to the seed investors when the token was trading at USD 4, after selling 6.5 million tokens in a seed round at USD 0.15.
“That’s an “airdrop” to seed investors, valued at USD 13.3M, giving seed investors a paper return of over 13x, on just a portion of the purchase,” noted DAO Maker, adding that MTA trading volumes then went up while the price crashed, pointing to a possible dump by the seed investors.
The mStable team quickly apologized for their actions and pledged to remove the tokens from circulation for three months.
Moreover, James Simpson, CEO, and Co-founder of mStable added that while his team had provided accurate info about the MTA token distribution, it was “too high-level” and could’ve been misinterpreted.