Trove's shift to Solana triggers market turbulence: $9.4 million ICO funds' whereabouts questioned, tokens plummet 95%

Recently, decentralized perpetual contract exchange Trove Markets suddenly announced a shift from the Hyperliquid ecosystem to Solana after completing an ICO of over $11.5 million, and decided to retain most of the raised funds. This caused its TROVE token to plummet over 95% within minutes of trading launch. The incident sparked intense discussions in the crypto community regarding project team responsibilities, fund transparency, and ICO ethics.

Event Review: An “Unexpected” Ecosystem Shift

Trove Markets was originally built as a decentralized perpetual contract exchange based on Hyperliquid infrastructure. Based on this vision, the project successfully raised over $11.5 million through a public token sale, far exceeding its initial goal of $2.5 million.

However, just days before the scheduled Token Generation Event (TGE), the project team unexpectedly announced they would abandon Hyperliquid and fully pivot to the Solana ecosystem for rebuilding. The project explained that the direct cause of this “Solana pivot” was the withdrawal of a key liquidity partner, who had originally promised to provide liquidity support of about 500,000 HYPE tokens. Losing this pillar, the team believed continuing development on Hyperliquid was “no longer meaningful.”

More critically, Trove later confirmed that despite the fundamental change in development roadmap, they would retain $9,397,403 of ICO funds to continue development on Solana. The project stated that approximately $2.44 million had been automatically refunded, another $100,000 would be gradually returned, and the remaining funds had been used or planned to be used for paying developers, front-end and back-end infrastructure, CTO expenses, consulting services, marketing, and operational costs.

Market Reaction: TROVE Token Experiences “Freefall” Crash

The sudden decision and controversy over fund management immediately triggered fierce market reactions. According to DEX data, within just ten minutes of trading, TROVE’s market cap plummeted over 95% from an expected approximately $200 million, with valuation briefly dropping below $20 million.

As of January 21, 2026, according to Gate market data, TROVE’s token price stabilized after sharp fluctuations, currently trading at a very low level. In contrast, its newly chosen underlying chain, Solana (SOL), experienced some volatility during recent market adjustments but maintained a solid ecosystem foundation and market share. Currently, SOL is priced at about $127.85, with a market cap of $72.17 billion, accounting for 2.49% of the cryptocurrency market share. Market analysis generally remains optimistic about Solana’s long-term technical roadmap and ecosystem development, but this has not prevented the collapse of the market value of the new project TROVE, built on its ecosystem, due to trust issues.

Community and Investor Concerns

This incident triggered strong backlash from investors and the community, with main concerns including:

• Rationality and transparency of fund usage: Investors believe funds were raised based on the promise of “building on Hyperliquid.” The project changed direction at the last minute but retained most of the funds, violating the basic agreement at fundraising. Although the team disclosed the intended use of funds, the community demands more detailed, auditable proof of expenditure.
• Token distribution and suspicious activities at listing: On-chain analysis firm Bubblemap pointed out that about 12% of TROVE’s supply appears to be controlled by a single entity through dozens of new wallets, which received funds from the same exchange within the same period. This pattern raised public suspicion about pre-sale fairness and transparency in token allocation.
• Project management and communication chaos: Previously, Trove experienced operational confusion during its ICO, such as announcing a five-day extension of the fundraising period, then retracting the decision hours later, calling it a “mistake.” Such unprofessional conduct was amplified during the “Solana pivot” incident, severely damaging the project’s reputation.

Solana Ecosystem: Opportunity and a Test

Trove’s decision to pivot to Solana undoubtedly stems from its high throughput, low fees, and thriving DeFi ecosystem. SOL’s price has fluctuated significantly over the past year, but as a top-tier blockchain, its network activity and developer engagement continue to grow. For any project aiming to develop on Solana, strong technology is just the foundation; community trust, transparent operations, and firm execution are key to long-term survival.

The Trove incident serves as a wake-up call for all ecosystem participants: even on the most promising chains, project governance and moral standards are the primary factors determining success or failure.

Lessons and Outlook: How Should Investors Protect Themselves?

The Trove incident exemplifies the high risks inherent in the crypto world. For investors, it emphasizes the importance of conducting thorough due diligence before participating in any ICO or early-stage project:

• Examine fund custody and usage terms: Understand whether funds are held by third parties, whether there are clear, transparent multi-signature wallets, and if fund releases are tied to milestones.
• Assess team track record and communication quality: Chaotic communication often signals internal management issues.
• Be wary of token distribution concentration: Excessive token centralization can lead to significant sell pressure or market manipulation after listing.
• Choose trustworthy trading platforms: Trading on platforms like Gate, which emphasize rigorous listing reviews, transparent market data, and secure trading environments, is crucial for avoiding poor-quality assets.

Conclusion

Trove Markets’ “Solana pivot” and the subsequent token collapse are not just a project crisis but also a reflection on the entire crypto startup funding and governance model. While pursuing innovation and speed, integrity, transparency, and respect for investors must remain inviolable principles. Regardless of market fluctuations, these fundamentals are the cornerstone of building a sustainable crypto ecosystem.

For users interested in exploring frontier ecosystems like Solana, Gate will continue to provide comprehensive, timely market data, in-depth project analysis, and secure, reliable trading services to help users navigate the dynamic crypto world steadily.