The native and governance token Alpaca Finance, ALPACA, has experienced an extraordinary rebound in the face of an impending delisting from leading exchanges. The Fantom and BNB chain-based token has surged 526% within 24 hours as trading volume increased.
Alpaca Finance is a yield farming protocol built on the BNB Chain, allowing users to borrow funds to amplify returns on their liquidity provision. The token’s market capitalization hovered around $30 million before recent events, with daily trading volumes struggling to exceed a few million dollars. However, tides changed after the delisting announcements.
ALPACA Surges Amid Delisting Notice
Last week, crypto exchanges Binance and Bybit officially announced that they would remove trading pairs for ALPACA, with Bybit delisting its perpetual contract. After the notice, the token’s price dropped by roughly 70 percent, falling from about $0.21 to just over $0.10. Most traders interpreted the crash as common for small altcoins facing delisting.
Interestingly, contrary to the bearish forecasts, ALPACA reversed course on April 25, rallying 245%, thereby triggering buying pressure. The following day, the token doubled again, reaching approximately $0.35. Fast forward to today, and it surged 526% (from $0.18 to $1.19).
Why the Price Rally?
According to an official tweet following the Binance delisting announcement, Alpaca Finance temporarily stopped creating new tokens. The move was meant to control supply, but it ended up increasing fear of missing out (FOMO) among traders, driving prices even higher.
Another significant price catalyst is the buyback and burn events. Each week, Alpaca Finance channels a share of its protocol revenues into repurchasing ALPACA on the open market and sending those tokens to an irretrievable burn address. The program has permanently removed over 34 million ALPACA (approximately 18.4 percent of the maximum supply) since its inception.
The 214th weekly buyback, which was completed a few hours before the price surge, destroyed 188,888 ALPACA ($41,500). Notably, it was significantly larger than the average weekly reduction, making it one of the largest burns the token has experienced. Investors believe the move will make the crypto more valuable, which is why the price surge followed it.
Meanwhile, ALPACA is not the first crypto to post massive short-term gains. Dogecoin skyrocketed by over 23,000 percent in early 2021, peaking at $0.70, driven by the memecoin craze and Elon Musk’s endorsement. However, most of those gains vanished as quickly as they came.
