NIGHT from peaks to valleys: how airdrop scam set a trap for traders

The curtain has risen on the NIGHT rally. While the previous day the asset showed a 24% jump amid airdrop euphoria, the reality turned out to be much darker. Current CoinMarketCap data show a -0.78% decline over the last 24 hours at a price of $0.06, dispelling traders’ optimism. Pressure from large players and the low quality of capital that flowed in during the airdrop announcement created a perfect storm for mass liquidations.

Airdrop as bait for retail traders

When Midnight announced the distribution of 4.5 billion NIGHT starting December 10, it triggered a global influx of speculators. Exchanges Bybit and Binance accounted for the lion’s share of volume—$3.33 billion and $1.16 billion respectively—making up nearly 91% of the market flow. However, this trading volume was an illusion. The volume-to-capitalization ratio of 372% indicated a concentration of hot money rather than confidence from long-term investors.

Inflows on perpetual markets increased by 56% to $106.05 million, but the structure of this money tells much more than the volume itself. Data on Funding Rate and OI-Weighted Funding Rate remained in the negative zone, indicating a dominance of short contracts among traders. In other words, most of those buying NIGHT at the peaks were actually betting on further price increases, not declines. When the price started to fall, short sellers began closing their positions aggressively, amplifying the downward movement.

Concentration of ownership as the main vulnerability

The most alarming metric concerns token distribution. According to CoinMarketCap, 94.13% of the circulating supply of NIGHT is held by just 10 wallets, while retail traders control a meager 5.87%. The latest data show a concentration level of 80.10% in the top 10 addresses—an indicator of extreme centralization.

This means that every price movement depends on the sentiment of a few whales. As soon as they decided to take profits at the airdrop peaks, retail traders found themselves trapped. The number of token holders dropped from 6,800 to 6,200—clear evidence that small players were massively liquidating unprofitable positions. Short positions lost $1.61 million, while longs only $418 thousand, indicating market asymmetry and chaos.

Conclusion: hold your head

NIGHT demonstrates a classic pump-and-dump scenario involving institutions and whales. Although the airdrop attracted millions of traders, the quality of the capital that flowed in remained questionable. Today, the balance has shifted in favor of the bears, and the fact that the price declined by 0.78% with 9.99 million addresses holding indicates that most newcomers have already decided that this airdrop was not as hot as it seemed.