Hello everyone, I'm writing this post as and adjunct to the financial analysis post I did regarding INJ token (this one https://www.reddit.com/r/injective/comments/14pv0rg/inj_token_fundamentals_its_bad/?utm_source=share&utm_medium=android_app&utm_name=androidcss&utm_term=1&utm_content=1 )
What I'm presenting to you are further results from financial analysis I did on INJ token, and they are NOT investment advice.
- One important metric that investors can use to quantify the percentage of the IMMINENT correction of INJ 's price, and that I forgot to mention in the above-cited post, is the concentration of INJ token holdings
- As you can see in the screenshot, the 10 most INJ-rich wallets contain an aggregate amount of tokens that equals to 90% of total held tokens, with just the first two wallets accounting for a whopping 75% of the circulating supply (which is another word for “total held tokens”)
- It means that if just the 2 richest wallets sell all of their tokens, the price respectively drops 75% from the current level. If you calculate the Gini coefficient using the publicly available data, the result is a value > than 0.9 (using a 0 to 1 scale with decimal intervals) which signifies that the distribution inequality of tokens between market partecipants is far greater than the wealth inequality between citizens of any country in the world (for comparison, the U.S. has the highest Gini index for wealth distribution, at 0.84 or 84%, with 10% of households owning >70% of the country's wealth). In the INJ market, 2 wallets out of 15000 total wallets (0.01%) own 75% of market cap value. In short, the two biggest wallets dumping their holdings alone can be categorized as a rug-pull
- The top 10 holders (which are probably VC or Private Equity firms) are highly incentivized by the current macroeconomic conditions to DUMP their holdings when investors and traders are no longer buying the token above market value (more on that in the above post), and when that happens, the effect equals an 89.9% correction in the price of INJ.
Stay safe.