1INCH Price Drops Due to Token Concentration - A Lesson from On-chain Data

Recent events with 1INCH are not just a typical price drop but also a practical lesson about hidden risks within project tokenomics structures. Thin liquidity and large concentrated tokens held by a few individuals have become a danger when they decide to sell off. This event serves as a journal—highlighting the deadly weaknesses of the current altcoin market.

Unexpected On-chain Data

According to on-chain tracking data, a large sell order just wiped out market liquidity. Specifically:

• Sell volume reaching 14 million tokens
• Trading value approximately $1.83 million
• This massive sell order cleared all buy walls, causing the price of 1INCH to plummet -7% from $0.1385 down to $0.129

However, compared to current data (February 2026), the price of 1INCH has recovered to $0.12 with a growth of +6.55% in the past 24 hours. The current trading activity indicates the market has fully absorbed this “sell-off” event.

Origin from Token Vesting

Notably, the volume of tokens sold did not come from market purchases but from wallets linked to investors or project members through vesting contracts:

• This wallet accumulated 15 million 1INCH from vesting rewards a year ago
• First sell: Tried selling 1 million tokens at a favorable price ($0.17)
• Second sell: Decided to completely liquidate the remaining 14 million tokens at $0.13

This action reflects a loss of confidence in the project’s short-term prospects by those holding rights within it.

Tokenomics Concentration and Psychological Effects

This event is an important lesson about the dangers of concentrated tokenomics. Current data shows the Top 10 addresses hold 61.73% of the total circulating tokens, indicating a very high level of concentration.

When a large amount of tokens is in the hands of a few influential individuals and they decide to sell, the price chart can be “broken” regardless of technical analysis. Such actions often trigger a psychological domino effect, causing smaller holders to panic and sell off as well.

Practical Lessons

The 1INCH event is not an isolated case. It exposes a systemic issue: when liquidity is too thin and tokens are overly concentrated, the market becomes vulnerable to actions by a few individuals. That’s why many long-term projects distribute tokens broadly and design gradual unlock mechanisms.

This content is for informational and event-recording purposes only, not investment advice. Always consider carefully before making any investment decisions.