Kaito AI Airdrop Raises Tokenomics & Sell-Off Concerns

Kaito AI, a crypto intelligence platform, is allocating 20% of its total token supply to airdrops and incentives, aiming to reward early supporters and encourage adoption. 

Kaito AI brands itself as the “ultimate Web3 information platform” and is set to distribute 10% of its total tokens to early community members, Genesis NFT holders, and key ecosystem participants. This move is generating excitement, but concerts about token distribution remain. 

In a Feb. 20 post on X, the platform shared that 19.5% of its tokens would be set aside expressly for airdrops and long-term incentives, while 56.6% of its tokens would be distributed to the community and ecosystem.

Kaito token allocation, Source: Kaito AI

Marcin Kazmierczak, co-founder and COO of RedStone shared that Kaito is also changing the game in crypto marketing. It introduced a new metric called “Smart Followers” that measures how many respected or active crypto users engage with an account. He also said, “Currently, I do not know a single serious marketer that wouldn’t use Kaito stack.”

However, some experts are concerned about tokenomics, especially the huge percentage reserved for insiders. Onchain investigator RunnerXBT reported that 43.3% of the whole supply is reserved for insiders, 35% for the team, and 8.3% for early investors. Critics are concerned that this might lead to selling pressure following the airdrop, especially given the present market slump.

Airdrop farming, in which users aim to maximize rewards by using distribution techniques, is another issue in the space. For example, farmers claimed $3.3 million in tokens as part of the 2023 Arbitrum airdrop.

However, Kazmierczak argued that Kaito’s system is designed to prevent such exploitation. He stated, “Today’s airdrop allocation will be defined by the number of Yaps collected, which were very hard to bot, and Kaito genesis NFTs held at the snapshot.”

Despite attempts to reduce farming, there are still fears about a possible sell-off. Anndy Lian, a blockchain specialist, indicated that Kaito’s token might follow a similar pattern: “Big hype, big spike, then massive sell-off.” He said that even if some tokens have vested, early investors may still want to cash out immediately.