Cronos (CRO) is feeling the heat. The token’s price dipped to $0.08 over the weekend, continuing its multi-week decline. Investors are reacting to a crucial community vote that could introduce substantial dilution by minting 70 billion new tokens. With the proposal set to pass, what’s next for CRO?
A Vote That Could Reshape Cronos
The numbers tell the story. The Cronos community is voting on whether to create a Strategic Reserve by minting 70 billion new tokens—essentially undoing a major burn that previously slashed supply from 100 billion to 30 billion. So far, the proposal is well on its way to approval.
Data from MintScan shows:
- Votes in favor: 4.6 billion CRO
- Votes against: 1.22 billion CRO
- Abstentions: 1.48 billion CRO (20.22% of total votes)
This means the proposal has surpassed the required quorum, making its passage all but certain. If finalized, it will result in one of the largest token dilutions in recent crypto history.
The Rationale Behind the Move
The developers argue that this Strategic Reserve is necessary for Cronos to achieve its long-term ambitions. Their goal? To position the blockchain as a leader in AI-driven decentralized applications. Crypto.com, the entity behind Cronos, also envisions bridging the gap between crypto and traditional finance. One potential step: launching exchange-traded funds (ETFs) backed by CRO.
But there’s a catch. These 70 billion tokens won’t hit the market immediately. The plan includes a five-year lock-up period, extending the overall holding time to ten years from their original issuance on Ethereum. After that, tokens will be released gradually on a monthly basis.
Still, existing CRO holders face inevitable dilution in the coming years—a factor that continues to weigh on sentiment.
The Bigger Picture: Cronos’ Struggles
The vote comes at a tough time for Cronos. The network’s total value locked (TVL) has plummeted to $397 million, a massive drop from over $3 billion in 2022. This decline raises concerns about the chain’s traction in the DeFi space.
A look at broader trends reveals:
- Falling user engagement in Cronos-based applications.
- Increased competition from chains like Solana and BNB Chain.
- A shifting narrative towards AI and traditional finance integration, moving away from its original DeFi-heavy focus.
Technical Analysis: More Pain Ahead?
Cronos’ price chart paints a bearish picture. The token has dropped for seven consecutive weeks, trading at its lowest level since November 2023.
Key technical indicators suggest further downside:
- Below the 50-week moving average, signaling bearish momentum.
- RSI and MACD trending lower, pointing to weak buying pressure.
The next major support level sits at $0.05125—the lowest point from 2022 and 2023. If CRO breaks below this level, it could face an extended sell-off.
On the flip side, any recovery would need to clear $0.1800, a key resistance level from March last year. However, given current sentiment, a rebound looks challenging in the near term.
