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Token Unlockings to Flood the Market, Causing Concerns for Sellers
A significant number of digital assets are expected to be released in the cryptocurrency market this week, making it a challenging time for sellers due to the high volume of token unlocks. Market experts are predicting that the $213 million worth of tokens will be unlocked soon, with concerns about high demand and price fluctuations.
Avalanche (AVAX) is at the forefront of this announcement, which is expected to release $192.74 million in new token sales, representing 9.52 million AVAX token holders or 2.41% of its circulating total. Given the significant push by these tokens into the market, there is a chance that they will generate more pressure to sell, potentially impacting the fate of the token. At $20.59, AVAX has fallen by 6% in value over the past week.
However, it’s important to note that 63.07% of its total supply has already been freed up. The impact of the upcoming unlockings may be lessened, as the market has already absorbed a significant amount of AVAX tokens.
Other ecosystems are also releasing tokens: Pixels (PIXEL), Space ID (ID), 1Inch (1INCH), Galaxy (GAL), Acala Token (ACA), Forta (FORT), and Ethena(ENA). The amounts are considerably lower than those of Avalanche, but they do represent a significant flood of tokens into the market.
For instance, Pixels is expected to release 54.37 million token sales worth $7.26 million, which is 7.05% of its circulating stock. The token’s price may be affected by this release, as it only accounts for 20.86% of the total supply.
Space ID (ID) is a notable unlocking, with $6.6 million worth of tokens set to be released and 4.29% of its circulating supply available. The remaining unlockables, such as 1Inch, Galaxy (GAL), Acala Token (ACA), Forta (FORT), and Ethena(ENA), are much smaller and range from $67,640 to $880,000.
Even though they are relatively minor, these smaller releases can still contribute to the overall selling pressure and market volatility.
The impending unlockings have caused some market participants to worry about potential price fluctuations. The impact of these events is not yet evident, but past data indicates that significant token unlockings can result in higher selling pressure and lower prices.
As the cryptocurrency market experiences this potentially chaotic period, investors and traders will be closely monitoring the situation and altering their strategies accordingly. The market’s ability to handle the influx of tokens without significant price fluctuations is uncertain.
Market participants should be cautious and keep themselves informed about the potential unlockings, as they could have a significant impact on the cryptocurrency market in the near future. For more insights on token unlockings and their impact on the market, be sure to check out our article on Token Unlockings and Their Impact on Cryptocurrency Markets.
Stay informed, stay ahead!