Novastro token launch faces volatility and rug pull accusations after $XNL drops 70%, as the team defends RWA vision and announces buybacks.
Author: Akshat Thakur
October 30, 2025 – The Novastro token launch has ignited heated debate across the crypto community. Once hailed as a breakthrough in real-world asset (RWA) tokenization, the project’s debut of its native token, $XNL, has instead drawn accusations of a “rug pull” following sharp price declines and liquidity issues. Founder Shreedhar Shreenivasa insists the sell-off is temporary, citing buybacks and renewed focus on long-term development.
The Novastro token launch introduced $XNL as part of the project’s mission to bridge real-world assets with blockchain through a modular, AI-enhanced ecosystem. Novastro operates as a hybrid Layer 2/3 platform secured by Ethereum, with scalability across Arbitrum, Solana, and Sui.
Its architecture blends AI-driven asset management, automated SPVs (Special Purpose Vehicles), and Digital Twin Containers (DTCs) for decentralized applications. The company’s stated vision “RWA On-Chain Without Limits” targets seamless tokenization of assets such as real estate, commodities, and equities.
Supported by investors including Woodstock Fund, Double Peak, and CSP DAO, Novastro raised $1.2 million in its seed round. However, transparency concerns emerged as trading began and market activity spiked.
Shortly after the Novastro token launch, $XNL crashed from $0.05 to roughly $0.013, wiping out more than 70% of initial value. On-chain analysis revealed that several wallets sold large allocations within hours around 15.5 million tokens, or 8% of supply fueling accusations of insider dumping.
Community reports claimed the top ten wallets held 75% of total supply and that exchange liquidity was “near zero.” Posts on X described the event as “a soft rug,” pointing to identical gas patterns and wash-trade-like activity.
Critics also flagged Novastro’s choice to unlock 100% of public sale tokens at TGE, arguing it set the stage for volatility. Others referenced two prior troubled launches on the same launchpad, raising questions about due diligence.
Addressing the controversy, founder Shreedhar Shreenivasa denied all rug pull claims. He attributed the crash to unlocked public sale tokens being sold before liquidity pools were fully established. “The first 24 hours after TGE are always challenging. The market has settled, and we’re focused on building,” he stated.
He confirmed a 2% buyback of circulating supply between $0.01 and $0.02 and hinted at upcoming Tier-1 partnerships to rebuild momentum. The next token unlock is six months away, which Shreenivasa says will “stabilize selling pressure.”
He also pledged to share on-chain data and market-maker reports publicly, adding, “All presale investors and partners are identifiable; there is no hidden dump.”
Despite the fallout, Shreenivasa reaffirmed Novastro’s roadmap, prioritizing buybacks, liquidity partnerships, and expanded RWA integrations. He also announced plans for on-chain governance to improve transparency and community oversight.
At present, $XNL trades around $0.012, down from its $0.05 launch price. Analysts say sustained recovery will depend on consistent updates, verifiable liquidity, and clearer token-holder disclosures.
The Novastro story highlights the fragile balance between innovation and accountability in crypto markets, where enthusiasm can rapidly turn into skepticism.
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