Linea Treasury Wallet Moves Over 5 Billion LINEA Tokens, Triggering 84% Price Collapse and Community Outrage

On-chain data from Arkham Intelligence has revealed significant and controversial activity from the Linea project's treasury wallet. The wallet address 0x7fBE2… holds approximately 44.6 billion LINEA tokens, representing about a quarter of the total supply. Since the token generation event (TGE) in September 2025, this wallet has moved over 5 billion tokens.

The transfers were not direct; they were routed through intermediary wallets, such as Gnosis Safe proxies, before appearing on exchanges. This pattern has sparked a major backlash, as critics argue it directly contradicts Linea's previous statements. The project had previously asserted it would not create sell-side pressure because it lacked third-party investors who might dump tokens. The community now alleges the treasury itself is engaging in the very activity it promised to avoid.

The timing of these movements has compounded user frustration. Many holders were retaining LINEA tokens in anticipation of potential MetaMask-related airdrops. Instead, they have witnessed the token's value plummet from an all-time high of $0.05 to around $0.0078—a staggering decline of 84%. Daily trading volumes have remained thin, mostly fluctuating between $20 million and $40 million.

Social media reaction has been intense, with users expressing anger that the project is undermining its own liquidity. Comparisons are being drawn to other Layer 2 ecosystems, like Optimism and Arbitrum, where foundation-controlled wallets have sold large quantities during periods of high retail interest. Critics contend these actions damage long-term confidence in an already competitive sector.

This incident reflects growing skepticism about Layer 2 token economics more broadly. The industry is questioning whether current L2 models can sustain healthy markets without more transparent distribution structures and predictable unlock schedules. Linea's case is particularly notable because the project initially presented itself as community-first with neutral incentives; the treasury wallet activity suggests a different reality.

Without clear explanations from the team, the narrative is shifting. Some users are now calling for major exchanges to delist the LINEA token unless transparency improves. The controversy represents a critical moment for Linea and the Layer 2 sector, highlighting how fragile trust can be when on-chain behavior contradicts public promises.