Token Price Crash, Layoffs, Developer Exodus — Is Berachain a Doomed Public Chain?

Original Author: Ma He, Foresight News

On January 14th, BERA experienced a sharp pump, surging from $0.5 to $0.9. This was a rare occurrence amidst its previous 12 consecutive weekly declines. On the same day, the Berachain Foundation released its 2025 year-end summary, highlighting ecosystem expansion, technical optimization, and community engagement post-mainnet launch, while also candidly acknowledging the various pressures brought by market volatility.

Following the launch of the Berachain mainnet, both its TVL and token price have experienced severe fluctuations. This is perhaps not merely an effect of market cycles but a combined result of internal strategies and external pressures.

TVL Plummets from $3 Billion to $180 Million, Chain Generates $84 in 24-Hour Revenue

In February 2025, Berachain officially launched its mainnet, introducing an innovative Proof-of-Liquidity (PoL) consensus mechanism. This mechanism aims to incentivize application and user participation through liquidity proofing, as opposed to traditional Proof-of-Stake, positioning Berachain as a Layer 1 blockchain specifically designed for DeFi applications to enhance capital efficiency and user adoption. Initially, the ecosystem expanded rapidly, attracting hundreds of dApps, including DEXes like BEX, lending protocols, and NFT marketplaces.

TVL once skyrocketed to $3.3 billion, with over 140,000 active addresses and transaction volume reaching 9.59 million. The Foundation also supported multiple ecosystem projects through its RFA (Request for Application) and RFC (Request for Comment) programs and collaborated with institutions like BitGo to provide custody services, enhancing the project's professionalism. Furthermore, Berachain's community building and marketing strategies performed exceptionally well in the early stages. Bear-themed NFT collections (like Bong Bears) attracted a large number of users, and airdrops and incentive programs further stimulated participation. These initiatives helped Berachain become a hot topic in the DeFi space in the first half of 2025, ranking as the sixth-largest DeFi chain.

However, as the token price continued its steady decline, data from DefiLlama shows its TVL has fallen to $180 million, with 24-hour chain revenue at $84. The total stablecoin supply on its chain is $153.5 million.

Retail First? Majority of Tokens Allocated to VCs, Major Unlock in February

In its year-end update, the Berachain Foundation acknowledged that the overall effectiveness of the "retail-first" strategy in the crypto market was poor, leading to a reallocation of resources. This directly triggered a series of issues. First were layoffs and team changes. As part of the strategic adjustment, the Berachain Foundation laid off most of its retail marketing team, shifting focus to core development. Berachain's lead developer, Alberto, is also set to depart to co-found a Web2 company with former banking colleagues.

The Foundation emphasized the departures were amicable, but this undoubtedly weakens the project's core technical strength. Within the community, some developers have already shifted to other chains like Monad, further exacerbating the brain drain.

Perhaps the "retail-first" strategy promoted by the Berachain Foundation never truly took off.

The project initially emphasized being community-driven, but in practice, the incentive mechanisms failed to consistently attract users, and the token allocation also sidelined retail participants.

While the PoL mechanism is innovative, its complexity (such as the multi-token model including BERA and BGT) deterred users, leading to a sharp decline in network activity. In November 2025, the project paused the network due to a vulnerability in the Balancer protocol, fortunately without affecting user funds.

The BERA token price has fallen from its high of $9 to around $0.7 today. In just one year, the token of what was once hailed as a top-tier public chain has dropped by over 10x.

This crash stems from a model of low circulating supply and high Fully Diluted Valuation (FDV), leading to artificially inflated prices followed by a rapid collapse. The root of these issues lies in Berachain's token distribution mechanism. Early contributors received 16.82% of the total supply, while private sale investors received a staggering 34.31% of the token allocation, making it a typical "VC coin." Furthermore, NFT holders could receive tokens worth tens of millions of dollars, while testnet users received only $60 in airdrops, sparking controversy over the "wealth gap" and marginalizing some loyal users.

This runs counter to the "retail-first" slogan. The project's essence is a VC-dominated model of low circulating supply and high FDV: early investors entered at $0.82, achieving 10-15x returns, while retail investors bore the brunt of the crash. Foundation founder Smokey admitted that if given another chance, he would not have sold so many tokens to VCs and has repurchased some to reduce dilution. In October 2025, the Berachain Foundation partnered with Greenlane Holdings to launch BeraStrategy, using BERA as a reserve asset, but this failed to reverse the token's downward trend.

Additionally, VCs like Brevan Howard's Nova fund hold refund rights, allowing them to request a full refund of $25 million before February 2026, further highlighting Berachain's tilt towards VCs.

Community dissatisfaction is high, with many users labeling it the "ultimate scam L1."

On February 6th this year, Berachain will unlock 63.75 million BERA tokens, approximately 12.16% of the total supply. Of this unlocked portion, private sale investors alone account for 28.58 million tokens. Starting from March this year, BERA will unlock 2.53% of the total supply every month. Given the current liquidity drought, the continuous large-scale unlocks this year may trigger significant selling pressure.