Midnight Network’s NIGHT token, the governance asset for Cardano’s privacy-focused sidechain has seen a heavy price drop in recent days. Following the launch of midnight NIGHT token saw a 89% drop, currently trading around $0.050, seeing a 6% drop in the past 24 hours.

So, whats fueling the price to drop below. 

Airdrop Selling Pressure Dominates

One of the biggest reasons behind NIGHT’s sharp drop is heavy selling from the airdrop. As soon as trading started, many early recipients, especially those from the “Glacier Drop,” sold a large part of their tokens. Some even sold their entire allocation right away.

This sudden wave of selling pushed the price quickly from around $0.11 down to $0.049.

Oversupply Of Token Added More Pressure 

Another major factor was the huge supply of tokens entering the market at launch. NIGHT began trading with 16.6 billion tokens already circulating, which the market simply couldn’t absorb.

Even though the broader crypto market was up by over 2%, NIGHT still crashed nearly 80% from its peak because demand couldn’t match the massive supply hitting exchanges.

The project unlocked 25% of airdropped tokens instantly, with the rest set to unlock over nine months. The high 24-hour trading volume of $27.78M showed strong activity, but not strong enough to handle the flood of tokens.

Launch Hype Fades as Tokenomics Draw Criticism

NIGHT launched on December 9 at $0.064, then pumped 85% in a short burst before collapsing to $0.035. Rapid profit-taking, DEX mispricing, and fading hype all added to the chaos.

Critics also pointed out that the large airdrop allocation and weak early sentiment made the token even more unstable compared to other Cardano-related launches like Jolteon.

The NIGHT and DUST dual-token model, along with a 360-day vesting plan for institutions, is designed to reduce long-term dumping. However, it was not enough to stop the immediate volatility during launch.

What’s Next for the NIGHT Token?

NIGHT has dropped nearly 90% in seven days, now trading below $0.050 with a market cap $826.7 million. Analysts think this fall may be a “shake-out,” where weak holders exit before the price settles.

The token is approaching support at $0.048, and the oversold RSI suggests a small bounce could happen soon. But if selling continues, NIGHT may dip below $0.045 and test the $0.040 zone.

But a breakout above $0.057 would be the first sign of strength, possibly pushing the token toward $0.063. Some expect a bigger recovery toward $0.098, but only if buying returns and unlock pressure slows.

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