Deal highlights growing gap between crypto infrastructure growth and tokenholder value
Axelar’s native token AXL recorded a sharp decline on Tuesday after Circle announced it would acquire the team and intellectual property of Interop Labs, the original core developer of the Axelar Network. The market reaction was swift, reflecting concerns that the transaction offers no direct economic benefit to AXL tokenholders.
Why Axelar’s AXL Token Fell
Following the announcement, AXL fell by around 13 15%, as traders digested the fact that the deal explicitly excludes the AXL token and the Axelar Network itself. While Circle is gaining engineering talent and proprietary interoperability technology, tokenholders are not included in the transaction’s upside.
Interop Labs’ developers will transition to Circle, while Common Prefix, another long-standing contributor, is expected to take on a larger role in maintaining and developing the Axelar ecosystem.
Axelar is designed to enable cross chain communication and asset transfers between blockchains. Although Circle’s move validates the technical strength of Axelars interoperability stack, it also highlights a growing industry trend.
Crypto mergers increasingly focus on teams and intellectual property, not tokens.
Protocol success does not automatically translate into token value.
AXL holders receive no buy pressure, revenue sharing, or governance influence from the acquisition. The episode underscores a critical lesson for investors: unless a token is structurally tied to deal economics, M&A activity can leave token prices exposed, even when the underlying technology is deemed valuable.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.