The recent market crash has left many altcoins seeking a path to recovery, but AVAX appears to be moving in the opposite direction. This is due to the upcoming massive token unlock scheduled for this week, which is expected to add further selling pressure to the already struggling digital asset.
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AVAX price falls ahead of $102M token unlock. $102 Million In AVAX Set To Be Unlocked
The Avalanche network, along with many others, has implemented a lock-up mechanism for a portion of its total token supply that is to be released into circulation periodically. These unlock events can potentially exert bearish pressure on a token, and may signal an exit opportunity. AVAX price falls ahead of $102M token unlock.
The next token unlock event for AVAX is scheduled for August 26, just five days from now. What makes this event particularly interesting is the number of tokens that will be introduced into circulation. According to Token Unlocks, a token tracking website, a total of 9.54 million tokens will be unlocked on Saturday. This represents 2.77% of the total circulating supply of the asset, which is currently valued at $102.29 million.
According to the website, the unlocked tokens will be distributed in four allocations, which are 1.13 million tokens ($12.06 million) for airdrop, 1.67 million tokens ($17.87 million) for Foundation, 2.25 million tokens ($24.12 million) for strategic partners, and 4.5 million tokens ($48.24 million) for the team. This will result in over 55% of the total token supply being unlocked, leaving less than 45% of the supply locked. The release of these 9.54 million tokens into the market could potentially have a negative impact on investors.
Will AVAX Price Be Impacted?
The upcoming unlock of $102 million in tokens is likely to cause a significant impact on the AVAX price as a considerable portion of it is expected to enter the open market. This influx of selling may worsen the current situation for AVAX, which is already experiencing a decline. It is predicted that the digital asset's price may drop below $10, which hasn't happened since July 2021. This could lead to further losses for AVAX holders, many of whom are already facing losses, as per data from IntoTheBlock. The indicators for AVAX are also bearish, with the price currently sitting below the 100-day and 200-day simple moving averages, indicating no short-term recovery for the digital asset, particularly with the unlock event approaching. At present, the AVAX price is hovering at $10.56, having decreased by 13.15% in the last week.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.