$650 Million in Token Unlocks Threaten Altcoins

0 Million in Token Unlocks Threaten Altcoins

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The recent rally in altcoins has taken a breather as investors brace for a wave of token unlocks that could flood the market with new supply. Over the next week, nearly $650 million worth of tokens are scheduled to be unlocked, according to data from Token.Unlocks and CryptoRank.

This influx of new supply could put downward pressure on altcoin prices, especially for those tokens with large unlocks. For instance, dYdX, a decentralized exchange unlocked $480 million worth of tokens on December 1st, almost doubling its circulating supply. This could lead to a significant sell-off in DYDX tokens as early investors and team members take advantage of the opportunity to cash out.

Other Token Unlocks 

Optimism (OP) unlocked $41.5 million tokens on November 30, 2023, representing 0,56% of its circulating supply. Sui (SUI) will unlock $40.9 million tokens on December 1, 2023, representing 0.69% of its circulating supply. Axelar (AXL) unlocked $18.7 million worth of tokens on November 28, 2023, representing 2.3% of its circulating supply. 

Immutable X (IMX), 1inch (1INCH), and Hedera (HBAR) are scheduled to unlock $50.3 million, $33.7 million, and $11.1 million, respectively. 

The token unlocks come at a time when the broader crypto market is already showing signs of weakness. Bitcoin, the world’s largest cryptocurrency, has been trading sideways for the past few weeks, while the total crypto market cap has fallen from its November highs.

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This combination of factors could put a damper on the altcoin rally in the near term. However, some analysts believe that the long-term outlook for altcoins is still positive. They point to the growing adoption of blockchain technology and the increasing popularity of decentralized applications (dApps) as reasons to be bullish on altcoins.

What does this mean for investors?

Investors should be aware of the upcoming token unlocks and factor them into their investment decisions. They should also be cautious about investing in altcoins with large unlocks, as these tokens could be more volatile in the near term.

However, investors should not panic and sell all of their altcoins. The long-term outlook for altcoins is still positive, and there is still plenty of room for growth in this market.

Investors should do their research and understand the tokenomics of the altcoins they are investing in. They should diversify their portfolios, invest in a variety of altcoins, and be prepared for volatility. The altcoin market is still relatively young and volatile, and token unlocks can cause significant price swings. Investors should be prepared for this and have a long-term investment horizon.



https://zycrypto.com/650-million-in-token-unlocks-threaten-altcoins-what-should-holders-do/

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About the Author: Daniel