Berachain’s BERA Airdrop Slammed Despite $1.5 Billion Market Cap Surge

Layer 1 Berachain’s native token BERA surged to a $1.5 billion market cap on Thursday following its highly anticipated airdrop and the launch of its mainnet. But some traders have raised concerns about the chain’s tokenomics.

Since going live at 8 a.m. EST, BERA jumped approximately 71%, reaching a peak of $14.83 and a market cap of $1.5 billion before slightly retreating to around $13, bringing its market cap down to $1.3 billion, according to CoinGecko data.

The total genesis supply of BERA is 500 million tokens, allocated as follows: 16.8% to initial core contributors, 34.3% to investors, and 48.9% to community allocations. The community portion is further divided into a 15.8% airdrop, 13.1% for future community initiatives, and 20% dedicated to ecosystem development and research.

Of the total BERA supply, around 79 million was allocated for the airdrop earlier today. From this supply, around 8.25 million tokens were allocated to testnet users, 1.25 million to social media users who offered “constructive commentary about Berachain on X,” and another 11.7 million to successful recipients of the Request for Application or Request for Community programs.

Growing Skepticism

The surge comes after significant developments, such as NFT marketplace Magic Eden backing Berachain and the upcoming listings of the token on major exchanges like Binance and OKX. While this has intrigued some investors, others are skeptical of Berachain’s innovation.

Founded in 2021 and based in the Cayman Islands, Berachain uses the Proof of Liquidity (PoL) consensus to reward liquidity provision and drive growth. Berachain's governance system utilizes $BGT, enabling token holders to influence key decisions about Proof of Liquidity and core dApps. Berachain has raised $42 million in venture funding, according to the Berachain Foundation.

Yugo, a prominent trading strategist known by the handle @yugoviking on X, shared his thoughts: “I think this is the ultimate grift L1. It is a pure fork that brings nothing to the table. It's almost as useless as Blast.”

Yugo called the airdrop “just another VC insider grift, with people wanting to get rich off of Ethereum tech,” noting that a “huge supply” was given to founders and early investors, who “got in at anything from $50M.”

Some traders have claimed that Berachain is forking Ethereum, calling it an “Ethereum Virtual Machine (EVM)-identitical L1.” Berachain’s honeypaper confirms that its modular framework “ enables developers to launch both L1 and L2 EVM-identical blockchains with full Ethereum Improvement Proposal (EIP) compatibility.”

Berachain did not immediately reply to a request for comment.

Questionable Strategy

Prominent crypto commentator @fejau_inc, who hosts the macro investing podcast Forward Guidance, also raised concerns, arguing that Berachain’s strategy is structured to exploit market conditions.

According to @fejau_inc’s X post, the project’s launch was strategically timed to coincide with “the top of the cycle for maximum FDV (fully diluted valuation)”. The post also pointed out that Berachain introduced perpetual futures contracts early on, enabling VC firms to hedge their holdings by shorting the token.

However, not all traders are harboring dislike for the Berachain ecosystem. One developer who goes by the handle of @the_smart_ape, said they “love” the platform, while sharing a screenshot of their airdrop holdings.

Blockchain oracle network Chainlink also showed its support for the platform in a post on X, noting that it now accepts the BERA token. “Start integrating the BERA/USD Data Stream to build highly secure and efficient DeFi markets around Berachain’s token,” the post reads.

Mainnet Launch

Despite the criticism, BERA’s surge in value coincided with the launch of Berachain’s mainnet, a key milestone for the Layer 1 blockchain. The mainnet debut marks the beginning of Berachain’s efforts to establish itself in the competitive blockchain ecosystem.

Over the past year, Bearchain has built a dedicated following and an active social media community with close to a million followers on X.