$650 million worth of tokens unlocked Altcoin rally cooled

2023-11-28 01:22:33

By Krisztian Sandor, CoinDesk, compiled by Song Xue, Golden Finance

Crypto tokens DYDX, OP, SUI fell sharply before a large number of tokens were unlocked, underperforming the broader Coindesk market index.
Unlocking increases the supply of digital assets and allows early investors to sell tokens.

Several major alternative cryptocurrencies, including dYdX (DYDX), Optimism (OP), and Sui (SUI), all fell on Monday as a large number of token unlocks weighed on prices amid the overall underperformance of the overall crypto market. **

According to Token.Unlocks and CryptoRank, the altcoin supply will increase by nearly $650 million this week. **

DYDX’s circulating supply will add about $480 million worth of tokens, almost double the number of tokens currently on the market. OP, SUI, Axelar (AXL), Immutable X (IMX), and 1inch (1INCH), as well as Hedera (HBAR), are also scheduled for mass unlocking in the coming days.

Token unlocking means an increase in the supply of assets, releasing tokens from vesting periods, including to early investors. A study by crypto analytics firm The Tie earlier this year found that large unlocking events typically cause prices to fall as supply growth outstrips investor demand for the asset. **

According to CryptoRank data, Axelar (AXL) is down 10% in the last 24 hours as Monday is the planned monthly token unlocking period, where around $18 million worth of tokens, or about 5% of its market cap, are added to its supply, including early investors.

Prior to the issuance of $480 million worth of tokens on December 1, DYDX fell 7% over the same period.

OP is down nearly 6%, and $40 million worth of tokens will be unlocked on November 30.

SUI plunged 8.8% on the day as its supply will increase by $48 million this week.

ON DECEMBER 1, 1INCH FELL MORE THAN 4%, AND ITS SUPPLY IS EXPECTED TO INCREASE BY ALMOST 10%, OR $33 MILLION. HBAR and IMX fell 2%-3% and each faced unlocking $11 million in tokens this week.

Meanwhile, Bitcoin (BTC) fell 0.7% over the same period, while the large-market cryptocurrency index, the CoinDesk Market Index (CMI), fell 1.5%.

Source: Golden Finance

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