Solana’s Biggest Airdrop Gone Wrong: Meteora Price Melts Down After Ben Chow Lawsuit

 

Why the Meteora Airdrop Went Wrong: Launch Hype, Insider Dumping & Lawsuit Fallout

On October 23 2025, the Solana-based decentralized exchange (DEX) Meteora Network formally unveiled its native token, MET. The launch had been highly anticipated — Meteora claimed to control more than a quarter of Solana’s DEX volume and boasted nearly $829 million in total value locked (TVL).

Despite the strong metrics, the token’s debut quickly turned rocky. Within hours, MET plunged by around 35–40 percent — from roughly $0.69 at launch down toward $0.57. Investors and analysts are asking one key question: Was this a promising DeFi event derailed by distribution flaws, insider sell-offs, and legal risks?

The Launch That Looked Strong on Paper

Meteora’s launch seemed well-positioned. The project offered a dynamic liquidity market maker (DLMM), a launchpad for new projects, and strong trading volume figures on Solana. Reports indicated that Meteora was generating up to $3.9 million in daily trading fees — eight times more than its rival Raydium. Tokenomics revealed that 48 percent of the total supply — 480 million out of 1 billion MET tokens — would enter circulation at launch.

At face value, the numbers supported optimism: high TVL, robust fee generation, and a community-first token drop.

Why the Crash Happened So Fast

Yet from the outset, three major headwinds converged — each one contributing significantly to the price collapse.

1. Oversupply and instant circulation.
Having 48 percent of tokens unlocked at the token generation event (TGE) is highly unusual in major launches. Many tokenomics frameworks limit initial circulating supply to between 10–20 percent to manage sell pressure. But in Meteora’s case, nearly half the supply was available immediately. Analysts warned this could trigger large-scale dumping.

2. Significant airdrop recipients with links to major players.
On-chain analytics revealed that three wallets closely tied to the meme token team behind the TRUMP token received about $4.2 million in MET during the airdrop and promptly transferred their holdings to exchanges. The immediate cash-out from these large allocations triggered alarm among retail investors and generated heavy selling pressure across markets.

3. Legal and reputational risk hitting at launch.
Perhaps the most critical blow was the class-action lawsuit filed on October 23 against Meteora co-founder Benjamin Chow. He was accused of running a $57 million fraud scheme involving celebrity-backed memecoins, including tokens tied to the names of Melania Trump and Javier Milei. The litigation overshadowed the token’s launch, undermining investor confidence just as MET began trading publicly.

The Immediate Market Fallout

The combination of oversupply, insider transfers, and negative headlines produced clear signals in the market:

• MET’s price dropped from around $0.69 to near $0.57 within hours of listing.

• Trading volume surged dramatically, indicating a high-volume scramble rather than a measured accumulation.

• Fear and distrust spread through the Solana community as observers noted familiar “airdrop dump” patterns seen in other controversial projects.

What This Means for the Legitimacy Question

Given the circumstances, many investors and commentators are asking whether Meteora is a legitimate DeFi protocol with long-term potential, or simply another high-profile launch burdened by structural and reputational flaws.

On one hand, the fundamentals appear strong: the DEX already has significant TVL and active trading volume, and the launch introduces tools like its DLMM and project launchpad. On the other, the tokenomics and launch execution raise serious concerns. The human element — a major lawsuit involving the founder and large airdrop allocations to questionable wallets — has added a significant credibility gap.

Near-Term Price Outlook and Technical Signals

From a technical standpoint, MET shows signs of weakness. Indicators such as RSI and MACD suggest bearish momentum, while volatility remains high. The oversupply and early sell-offs have left initial support zones fragile. Short-term estimates place MET trading between $0.52–$0.58 unless sentiment improves. Mid-term projections suggest downward pressure if the lawsuit worsens or if new trading volume dries up.

Longer-Term Potential: Hope or Hype?

Looking ahead to the rest of 2025 and beyond, three potential paths stand out:

• Path A (Recovery): Meteora addresses the legal issues transparently, the team regains control of the narrative, enhances adoption, and benefits from its infrastructure. MET could regain momentum.

• Path B (Flat-line): The token stabilizes at lower levels — roughly between $0.45 and $0.60 — with the protocol operating but investor trust remaining limited.

• Path C (Decline): Additional legal or regulatory issues arise, token distribution remains concentrated, and the narrative shifts from “DeFi innovation” to “pump-and-dump.” MET falls further.

What Investors Should Watch

To evaluate whether Meteora can recover or will falter, investors should monitor several key factors:

• Strategic partnerships and listings: New collaborations or listings beyond launch day can help restore confidence.

• On-chain wallet flows: Tracking large MET movements and exchange deposits could reveal whether early holders continue to offload tokens.

• Legal developments: Updates from the class-action lawsuit and any leadership changes within Meteora will influence investor sentiment.

• DEX adoption metrics: If Meteora continues to generate high TVL and daily trading volume, it may signal the project’s underlying resilience despite controversy.

Expert Views and Market Reactions

Some industry analysts believe the crash reflects deeper issues in the DeFi sector — particularly the reliance on airdrops to build hype. Airdrops often reward early users but can create imbalance by allowing insiders to dominate token holdings. Once the excitement fades, tokens tend to sell off sharply.

Others argue that Meteora’s fundamentals remain strong and that the token’s rapid price correction could represent a short-term reaction to panic rather than structural weakness. If the team can distance itself from the lawsuit and focus on ecosystem growth, MET could still evolve into one of Solana’s major liquidity hubs.

However, the challenge will be reputational. In a market shaped by trust and transparency, even a technically solid protocol can falter if the leadership faces credibility issues.

Could the Price Recover?

In the current environment, MET’s potential recovery depends largely on transparency and trust. A clear communication plan from the team, detailed progress reports, and open collaboration with the community could help stabilize the project.

Additionally, any partnerships with Solana-based DeFi protocols or integrations into major wallets could help rebuild optimism. Historically, DeFi tokens with strong use cases and consistent updates have managed to rebound after early crashes.

Still, the road ahead for Meteora remains uncertain. Market sentiment toward DeFi on Solana is cautious, and the broader crypto environment is still sensitive to external shocks like regulatory scrutiny and macroeconomic shifts.

Final Verdict

The meteoric build-up to Meteora’s MET token launch was fueled by impressive infrastructure and genuine excitement within the Solana ecosystem. Yet, the launch turned contentious almost immediately due to structural design (high circulating supply), insider activity (large airdrop recipients dumping), and reputational damage (lawsuit tied to the founder).

For now, investors would do well to proceed with caution. The project still holds real potential, but it needs to rebuild trust quickly. Without addressing these issues head-on, there’s a real risk that Meteora will be remembered more for its crash than for its promise.

If Meteora can overcome its early setbacks, repair investor confidence, and deliver sustained ecosystem growth, it might still turn this rocky debut into one of crypto’s most unexpected comeback stories.

Writer @Ellena

Erlin is an experienced crypto writer who loves to explore the intersection of blockchain technology and financial markets. She regularly provides insights into the latest trends and innovations in the digital currency space.

 

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