Solana News Today: Meteora's Phoenix Rebirth Sparks Debate: Legacy Rewards vs. Solana DeFi Fairness

Meteora, the Solana-based liquidity protocol formerly known as Mercurial Finance, is set to launch its native MET token on October 23, 2025, under a rebranded tokenomics framework dubbed the "Phoenix Rebirth" plan. The distribution structure, unveiled amid renewed scrutiny of crypto asset allocations, allocates 48% of the total supply to circulating tokens at launch, with 20% directed to legacy Mercurial stakeholders-a move sparking both optimism and controversy within the community After market manipulation scandal, can Meteora make a …^[1].

The tokenomics breakdown reveals a complex allocation strategy. At launch, 48% of MET will be immediately tradable, including 20% for Mercurial stakeholders, 15% for Meteora users via liquidity provider (LP) incentives, and smaller shares for launchpads (3%), Jupiter stakers (3%), off-chain contributors (2%), centralized exchanges (3%), and M3M3 participants (2%) Meteora TGE in October Could Reshape Solana DeFi - BeInCrypto^[8]. The remaining 52% is reserved for long-term incentives, with 34% allocated to Meteora's ecosystem reserve and 18% to the team, both subject to six-year linear vesting schedules Meteora Details Tokenomics for Upcoming MET Launch^[4]. Notably, the team emphasized that no tokens will be sold during the launch, and all circulating tokens will be liquid from day one .

The 20% allocation to Mercurial stakeholders has become a focal point of debate. On-chain data indicates that 58% of pre-rebrand MER tokens were concentrated in the top 10 wallets at the snapshot, raising concerns about centralization. However, Meteora co-leads Soju and Zhen Hoe Yong clarified that major pre-FTX exchange wallets, including those linked to FTX and Raydium, will not receive MET, redistributing allocations more evenly Meteora LP Army Divided Over $MET Tokenomics^[2]. Critics argue that the allocation still favors early insiders, while supporters frame it as a necessary step to reward foundational contributors to the Solana DeFi ecosystem Meteora Tokenomics Spark Debate Over Mercurial Stakeholders' …^[5].

To mitigate liquidity risks, Meteora introduced a "Liquidity Distributor," allocating 10% of the initial circulating supply as liquidity positions rather than direct airdrops. This mechanism allows users to earn trading fees while providing liquidity, aiming to stabilize price discovery and reduce immediate sell pressure . The approach diverges from traditional airdrop models, reflecting Meteora's focus on fostering a sustainable liquidity ecosystem.

Market reactions to the tokenomics have been mixed. Pre-market trading on platforms like MEXC saw MET priced at $1.69, implying a $1.5–$1.6 billion fully diluted valuation (FDV). However, bearish sentiment persists due to the lack of explicit buyback mechanisms and unclear utility for the token. Competitors like Raydium have employed token buybacks to sustain value, a strategy Meteora has yet to confirm Meteora LP Army Divided Over $MET Tokenomics^[2]. Polymarket odds also shifted lower after the announcement, with traders anticipating a $1–$2 billion FDV range, down from earlier $2 billion expectations Meteora LP Army Divided Over $MET Tokenomics^[2].

Meteora's journey from Mercurial Finance-a project once entangled with FTX's collapse-underscores its transformation. Originally launched in 2021, Mercurial gained traction with its dynamic liquidity models but faced setbacks during the 2022 market downturn. The rebrand to Meteora in late 2022 aimed to distance the protocol from FTX's fallout, and subsequent upgrades, including the DLMM AMM model, revitalized its total value locked (TVL) to over $50 million by late 2023 After market manipulation scandal, can Meteora make a …^[1].

The October TGE represents a critical test for Meteora's vision. With Solana's DeFi landscape increasingly competitive, the protocol's success will hinge on its ability to balance immediate liquidity demands with long-term governance utility. While the vesting schedules for team and reserves aim to ensure sustained development, risks remain, including concentrated early allocations and reliance on ecosystem growth to justify MET's value proposition Meteora Announces MET Token Economics: 48% of Supply Will Be …^[7].