WalletConnect stands as one of the most widely adopted interoperability protocols in the crypto world. Since its inception in 2018, it has facilitated over 275 million connections between wallets and decentralized applications (DApps), supporting more than 600 wallets and 61,000 applications. With a penetration rate exceeding 90%, this "connection layer" protocol finally launched its native token, WCT, on April 15, 2025, debuting on major exchanges including Binance, OKX, and Bybit.
Despite its strong technical foundation and market presence, WCT’s initial performance reflected a complex market sentiment toward infrastructure tokens. According to data from crypto researcher @AB Kuai.Dong, WCT conducted four funding rounds, with the last three at a consistent cost of $0.20 per token. However, at the time of writing, WCT opened with a fully diluted valuation (FDV) of $288 million and a circulating market cap of $53 million—only a 1.5x increase over its private sale price.
This article explores WCT’s tokenomics, market dynamics, challenges, and future potential.
Tokenomics and Initial Distribution
WCT has a total supply of 1 billion tokens, distributed across several key groups:
- 27% allocated to the foundation for ecosystem development
- 18.5% designated for airdrop incentives
- 30% held by the team and early supporters
This structure aims to balance community governance with long-term growth but also introduces certain risks.
Limited Circulating Supply
Only 18.62% of the total supply (186.2 million tokens) was released at launch. Among these:
- 44% came from Binance Launchpool mining
- 32% were held by early institutional investors like Coinbase
This concentration led to significant selling pressure on the first day, as early investors sought to realize gains.
Utility and Functionality
Currently, WCT supports staking and exchange trading. Other proposed utilities—such as governance, fee payment, and rewards—are pending community votes and future development. This "token first, utility later" approach has drawn criticism, as the token lacks immediate use cases.
Market Makers and Volatility
Market makers GSR Markets and Flow Traders control 8% of the initial circulating supply. While they provide liquidity, their high-frequency trading strategies can amplify volatility. For example, a 15% price swing occurred on OKX shortly after launch due to test transfers by market makers.
Competitive Landscape and Valuation
WalletConnect operates in the competitive wallet and infrastructure sector. It is often compared to:
- SafePal (SFP), with a $120 million market cap
- Trust Wallet (TWT), valued at $350 million
- Established projects like Chainlink (LINK) and The Graph (GRT)
WalletConnect’s protocol-level design gives it a unique advantage: each new wallet integration exponentially increases possible connections (600 wallets × 61,000 apps = 366 million potential links). However, monetization remains a challenge—90% of its 274 million connections are free, and the token economy captures less than 5% of this activity.
Potential for Growth
WalletConnect plans to introduce a "connection fee" model, charging high-frequency applications (like exchanges and blockchain games) 0.1–0.3 WCT per monthly active user (MAU). If implemented by Q3 2025, this could generate up to $30 million in annual revenue, potentially lowering the FDV/revenue ratio to a more reasonable 10x.
Challenges and Market Sentiment
WCT’s lukewarm reception highlights broader issues in the crypto market, especially during the Q2 2025 altcoin bear market. Investors are wary of high-FDV projects, and WCT’s 18.62% circulating supply-to-FDV ratio nears the market’s tolerance threshold.
Staking and Inflation Risks
Although staking offers an 85% annual percentage yield (APY), half of this comes from token inflation. This creates a "farm-and-dump" cycle that increases selling pressure over time.
Governance Participation
Less than 5% of token holders participate in governance votes, reducing the token’s utility as a governance tool.
Airdrop Impact
Only 15 million of the 185 million airdropped tokens were claimed. The unclaimed tokens will roll over into future incentive pools, but this has been perceived as potential future selling pressure.
Frequently Asked Questions
What is WalletConnect?
WalletConnect is a widely used interoperability protocol that enables secure connections between crypto wallets and DApps. It supports over 600 wallets and 61,000 applications.
How does WCT generate value?
Currently, WCT can be staked or traded. Future plans include using WCT for governance, fee payments, and rewards. The protocol aims to introduce connection fees for high-usage applications.
Why did WCT perform poorly at launch?
High initial selling pressure from early investors, limited utility at launch, and overall bearish market conditions contributed to its modest debut.
Is WCT a good long-term investment?
While the token shows promise due to WalletConnect’s market position, its value depends on successful implementation of new features like fee generation and expanded utility.
What are the risks of staking WCT?
High APY is partly fueled by token inflation, which may increase circulating supply and downward price pressure.
How can I stay updated on WCT developments?
👉 Track real-time token metrics and updates
Conclusion: The Future of Infrastructure Tokens
WCT’s challenging start reflects wider uncertainties about tokenizing infrastructure projects. While technology adoption doesn’t always translate directly to token value, WalletConnect has a solid foundation to build upon.
If the protocol can achieve three key goals by late 2025—generating 30% of revenue from fees, achieving positive real staking yields, and integrating with major Web2 platforms—it could significantly revalue the token. For now, WCT’s price of around $0.29 may present an undervalued opportunity for those patient enough to wait for utility to catch up with potential.