The Mao Party Fails Monad: "The logic of the testnet Mao Mao race has collapsed"

Author: Hu Tao, ChainCatcher

Yesterday, the highly anticipated Layer 1 public chain Monad’s token MON officially launched. Its price briefly fell below the public offering cost for early investors. Currently, its FDV remains in the $3 billion to $3.5 billion range, which is not only below the $8 billion mainstream market cap predicted on Polymarket but also far below the early Pre-TGE market valuation of $15 billion.

This not only dealt a heavy blow to the Layer 1 narrative but also marked a “tragedy” for the retail community involved in “撸毛” (profit hunting).

Previously, Monad was valued at $3 billion, making it the highest-valued unissued Layer 1 token in the market, and was highly anticipated by profit hunters. Its testnet has accumulated over 300 million interaction addresses, with many studios registering Monad addresses using millions of addresses. At the end of October, Monad officially opened airdrop queries but unexpectedly excluded all testnet interaction addresses from the airdrop.

The logic of profit hunters is that “sunshine” (public exposure) is a common practice among many projects. As long as they maintain frequent interactions, they can earn tokens worth a few dollars to dozens of dollars. The accumulated value of tokens across multiple addresses can still be significant. However, Monad’s official stance did not align with the profit hunters’ expectations, excluding all testnet addresses from the airdrop.

“A lot of addresses that interacted on the testnet are completely anti-harvest, and participating in various NFTs is basically useless. The only addresses that received the Monad airdrop are some old addresses that never interacted with Monad but traded on Hyperliquid,” said A Du (pseudonym), head of a profit-hunting studio in Hangzhou, to ChainCatcher.

Suddenly, Monad became the target of fierce criticism from many profit hunters, but the Monad team remained unmoved. According to well-known KOL Fengmi, the idea behind this airdrop was to bind contributors, identity, and potential into Monad—focusing on identity + contribution, such as Monad ecosystem developers, heavy DeFi users, and high-quality NFT holders.

Top alpha blogger Spark received a reward of 3 million MON tokens in this airdrop, worth about $110,000. This was not due to his interaction record but because he served as a moderator in the Monad community for three years and established the Chinese-language Monad community. The Monad team considers this a substantial contribution, which is a common criterion for airdrops by most projects.

For project teams, airdrops serve to reward long-term supporters and demonstrate their value for community users. They also aim to incentivize active participants and influencers in the surrounding ecosystem, attracting them into their own ecosystems through rewards. From Uniswap to Gitcoin, Arbitrum, Scroll, Berachain, Aster, and thousands of other projects, airdrops have become an essential method for attracting users.

Over time, the standards for airdrops have evolved and diverged. Some projects emphasize fairness and generosity, rewarding active profit hunters, while others impose strict rules on testnet/mainnet interactions, implementing rigorous vetting based on points. This time, Monad completely abandoned testnet users or retail investors.

“If a network neglects retail users for too long, it risks becoming overly elitist early on, losing the broad community foundation. Early blockchains like Bitcoin, Ethereum, Solana, and BSC relied on seemingly insignificant retail users who brought network effects and community vitality,” Fengmi said on X (Twitter). He believes Monad should allow grassroots retail investors to grow gradually— even a little—so more people can truly become part of the MON network community.

Chasing trends, some believe profit hunters contribute not only fees, data, and traffic but also serve as effective promoters. They argue that these participants should be incentivized. “Monad’s approach is reckless, shaking the trust foundation of the entire industry,” said Bingwa on Twitter.

From the project perspective, long-term development considerations should guide airdrop strategies. “Profit hunters lack loyalty; they sell immediately after receiving airdrops and move on to the next project. This only creates selling pressure without long-term benefits. Is it necessary to give them tokens?” said an anonymous KOL, describing profit hunters as “parasites” in the crypto ecosystem.

Australian veteran Tao also believes the industry’s logic for airdrops is changing. “In the past, CEXs focused heavily on on-chain data activity and active user metrics when evaluating projects, especially during cold starts. Projects often tacitly accepted or even reached an understanding with profit hunters: you come here to profit, help us get listed, and we’ll give you airdrops. But now, CEX listings no longer prioritize on-chain data or user metrics because everyone knows these numbers are heavily inflated,” he tweeted.

Business logic is ruthless. As on-chain data bubbles grow and profit hunters’ selling pressure negatively impacts many projects’ token prices, Monad’s approach is understandable. However, most projects will not follow suit because Monad, as a heavily capital-backed public chain project, still has many cards to play. Its technical strength and potential ecosystem explosion could bring in a large community of users. But for most projects, which are essentially marketing efforts, airdrops are necessary to attract attention and market hype.

In the long run, airdrops remain a vital source of value in the crypto industry, but their logic and targets are undergoing profound changes. “The results of Monad’s airdrop essentially mark the collapse of the testnet ‘black slave’ profit-hunting track. In the future, testnet activity will likely decline sharply,” Tao said.

In fact, many KOLs predicted this “table-flip” by Monad early on. Veteran influencers like Tao, Bingwa, and Fengmi openly stated they did not participate in Monad interactions. It is understood that top KOLs will focus more on “mouth-labor” (promoting through speech), arbitrage, and other diverse markets, while also concentrating on high-quality projects like Polymarket to create premium content.

Additionally, several studios interviewed reported that their earnings this year are lower than last year and below expectations. “The key is to find areas where we have advantages—low labor costs, advanced technology, early project insights, or influential KOLs for mouth-labor. Simply following the crowd to profit is now quite difficult,” A Du said.

As the market capitalization of top projects like Monad significantly falls below expectations, and many projects lock up user airdrop shares for long periods after TGE, profit hunters’ position in project ecosystems continues to decline, with token values shrinking. The profit-hunting logic based on volume alone is no longer sustainable.

“So, the era of retail newcomers entering the primary market for cheap gains has truly ended. The door has already been closing for a while; Monad’s airdrop just sealed the last crack,” Tao lamented.