Babylon launched its BABY token today after a brief delay from Binance. The toke quickly surged 40% to hit $0.15. driven by the listing hype, but airdrop sell-offs and profit-taking saw BABY crash shortly after.
Over the past week, Babylon’s airdrop has been subjected to much controversy. At the time of reporting, the token’s market cap stands just below $185 million.
BABY Airdrop and Token Launch
Token staking is a popular way to gain passive income in the space, and it’s growing noticeably. Last year, Babylon began offering Bitcoin staking and added on-chain yields soon after.
Today, Babylon launched its new BABY token, which began trading on Binance.
“Binance is excited to announce that Babylon (BABY) will be added to Binance Simple Earn, ‘Buy Crypto,’ Binance Convert, Binance Margin, and Binance Futures,” the exchange claimed in its announcement.
Binance, the world’s largest crypto exchange, was a natural candidate for Babylon’s BABY launch. It dominates the vast majority of crypto airdrops, and it offers very popular listings. The firm had to delay the official launch for a few hours, but it went off smoothly.
BABY was also listed by several other exchanges, including MEXC, which conducted an exclusive BTC Fixed Saving Event offering an Annual Percentage Rate (APR) of up to 99% in anticipation of the BABY token listing.
Babylon BABY Price Chart Since Launch. Source: CoinGecko
Babylon is a decentralized protocol that enables native, self-custodial Bitcoin staking. It allows holders to stake directly on the Bitcoin network to enhance security without relinquishing control of their assets.
Last week, the project airdropped 600 million tokens ahead of the token launch. The initial airdrop represented 6% of the total supply of BABY tokens, which were distributed to early adopters in several categories.
These include Phase 1 stakers, Pioneer Pass NFT holders, and contributing developers.
However, shortly after this airdrop, over $21 million worth of Bitcoin was unstaked from the Babylon protocol within 24 hours.
Increasing Concerns About Tokenomics
Also, its tokenomics indicate that nearly 66% of the total supply is controlled by insiders or the foundation. The substantial allocation raises concerns about potential centralization and the influence insiders may have on the project’s future.
Yet, there are community members refuting these concerns and backing the project. While insider allocation is high, access to that allocation is gated and structured to avoid market abuse.
Compared to recent examples where insiders had early staking rights and sold off rewards, such as EigenLayer, Babylon has deliberately built protections into its tokenomics to maintain fairness and avoid token dumping dynamics.
VCs, team, and advisors have no token unlocks in Year 1. This prevents early investors from front-running the market and dumping tokens during the protocol’s most fragile growth phase.
Most importantly, locked insider tokens are not allowed to be staked, which is rare.
Overall, the long-term performance of the token will reflect how sustainable this tokenomics is. Babylon’s approach to Bitcoin staking has gained significant attention, but the airdrop and subsequent unstaking activities highlight the dynamic nature of user engagement in response to incentive programs
