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Alex Navarro
Alex Navarro

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Polychain Capital Exits Celestia: $62.5M Token Buyback and Governance Realignment

Polychain Capital has fully divested from the Celestia project, according to an official announcement from the Celestia Foundation. The exit was executed through a token buyback valued at $62.5 million, marking the departure of one of Celestia’s earliest institutional backers.

Key Details of the Transaction:

  • The entire remaining TIA token allocation held by Polychain was acquired at approximately $1.44 per token.
  • The price was aligned with early-July market valuations.
  • All reacquired tokens will be redistributed to new investors.
  • A revised vesting schedule will govern access to these assets, spanning from August 16 to November 14.

Following the news, TIA is trading at approximately $1.86 — down 5.2% in 24 hours, based on data from The Block. This marks a significant decline from its January 2024 peak of around $20.

Background and Market Reactions:

The divestment follows mounting community criticism regarding the fund’s behavior around staking rewards. While Polychain’s core allocation remained locked, analysts observed that some staking rewards were actively being sold.

On-chain data from early July suggested Polychain may have liquidated TIA tokens worth up to $242 million since the token generation event (TGE). Of that amount, roughly $179 million was linked to staking reward wallets. By contrast, the firm’s initial investment across Series A and B rounds totaled approximately $20 million.

Protocol Response and Technical Roadmap:

In response to community concerns, the Celestia team has announced an upcoming mainnet upgrade — v4 “Lotus”, targeted for late July.

The release will include:

  • Revised staking reward mechanics
  • Emission rate reductions
  • Native integration support for rollup-based architectures

A notable change is the synchronization of reward unlocks with token vesting schedules. For example, if 50% of a wallet’s principal token balance is still locked, the wallet will only be eligible for 50% of its staking rewards. Where vesting is delayed, both principal and rewards will remain inaccessible until the respective unlock dates.

This adjustment is aimed at aligning long-term incentive structures and limiting speculative pressure from early stakeholders.

Implications for Developers and Ecosystem Participants:

  • The upgrade may influence validator and delegator behavior, particularly around staking strategies.
  • Rollup developers can expect improved integration pathways as native TIA support expands.
  • Emission and unlock logic should be reviewed when designing Celestia-based modules or interacting with staking APIs.

Polychain’s exit may signal a maturing phase in Celestia’s investor base — shifting from early speculative capital to longer-term, infrastructure-focused stakeholders.

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