The primary driver behind the crash was anxiety over an upcoming token unlock scheduled for May 11, 2025, which would release approximately 13% of LAYER’s total supply (about 27 million tokens) into the market. This increased circulating supply raised fears of heightened selling pressure, as early investors and insiders could offload large holdings. Even before the unlock, daily emissions of LAYER were adding to the supply, but the scale of the upcoming event intensified concerns. Market participants anticipated the unlock, but the sharp price drop suggests some large holders sold early to maximize profits. This perception of insider selling, combined with only 21% of the total supply circulating, eroded trust among retail investors. Additionally, the Solayer team’s lack of a public statement addressing the crash contributed to ongoing uncertainty and negative sentiment.
The token had surged 460% in three months, peaking at $3.41 on May 5, 2025, but plummeted over 45% to below $1.80 within hours, wiping out nearly half its market value in less than two days. Broader market risks and concerns about the project’s fundamentals also played a role.
