The 1INCH token experienced a tumultuous day on Tuesday, January 27, as onchain data revealed a significant distribution event orchestrated by its largest holders. This strategic offload of tens of millions of tokens directly coincided with a sharp double-digit price decline, sending ripples through its market.
Large Holders Initiate Strategic Token Distribution
Blockchain analysis paints a clear picture of substantial selling pressure from key 1INCH stakeholders. Approximately 36.36 million 1INCH tokens, equivalent to about $5 million, were strategically routed through CoW Protocol in a series of tranches rather than a single large dump. This calculated approach aimed to mitigate slippage and manage market impact during the distribution. Tracing the history of these wallets indicates that the sellers were likely early investors or contributors, as the tokens were received via vesting contracts established one to two years prior, confirming they were drawing from previously vested holdings.
Immediate Market Impact and Liquidity Stress
The market's reaction to this concentrated selling was swift and dramatic. The 1INCH token's price plummeted by 15-17% within hours, falling sharply from a stable range near $0.14 to as low as $0.115–$0.118. This steep decline mirrored the exact timing of the onchain sales. Accompanying the price crash was an extraordinary surge in trading volume, which spiked over 370% day-on-day to $62.2 million. This elevated volume, pushing the volume-to-market-cap ratio above 36%, is a strong indicator of forced repricing and acute liquidity stress. Occurring without a new token unlock, this distribution by vested holders exposed the fragile market structure of 1INCH, which had already been trending downwards. The coordinated selling during a period of thin liquidity significantly amplified the price movement, demonstrating how even relatively small portions of circulating supply (2.6%) can trigger abrupt repricing in vulnerable markets.
