Over the week, the crypto market will experience a significant wave of token unlocks. There will be a combined value exceeding $759 million worth of unlocks. This includes both large single-event unlocks and linear unlocks from projects like APT, SOL, NEON, and AVAX. The same could impact market dynamics.
Single Large-Amount Unlocks: Significant Supply Impact
Single large-amount token unlocks dominate the narrative this week. Massive amounts of the token are being released for multiple projects
As a leader, Aptos (APT) leads the way with $114 million worth of tokens or 11.31 million APT expected to circulate. That amounts to 2.02% of Aptos’ total circulating supply.
Unless backed by an equivalent increase in demand from investors, such a big increase in the supply of such a scarce commodity could result in downward pressure on the token’s price.
Another standout in this category is NEON, with 53.91 million tokens scheduled to be unlocked, worth $21.62 million.
In terms of percent unlock, this is a massive 28.52%. One of the highest unlocks for any token, as compared to other unlock dates.
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The nature of this release could be very volatile and possibly even price-lowering if token holders sell off.
Other interesting unlocks are MOVE, which will see $50M tokens 2.22% of supply enter the circulation. It also includes CXT with $12.86M unlocked 0.42% of its supply.
Across all, Banana will release 250 million tokens valued at $11.12 million, or 7.21% of its total supply. Different sizes of these unlocks show different impact, as a higher percentage of circulating supply usually has a bigger effect on the market.
Linear Unlocks: Gradual but Still Significant
Linear unlocks will further contribute to the market’s token supply in the form of single large-amount unlocks.
This first category is led by Solana (SOL) with $99.46M worth of tokens (465.77K SOL) being released into circulation gradually.
This makes up just 0.10% of SOL’s circulating supply, yet puts incremental supply pressure on the asset, which adds up to a decent amount of money.
One of the largest linear releases this week will be WLD, which will unlock $90.09M in tokens, or 4.34% of its supply.
Another batch of prominent tokens consisting of Dogecoin (DOGE), unlocking $36.50M worth of tokens, which is 94.47M DOGE, a 0.06% of supply. Avalanche (AVAX) is unlocking $30.06M worth of tokens, 700K AVAX, 0.17% of supply.
What’s more, Polkadot will unlock $28.73 million, a mere 0.18% of its circulating supply. While TIA will see $39.13 million in tokens released, 1.46% of its supply.
Other small but notable unlocks include ENS $13.20 million and SUI $21.82 million. Cliff unlocks, in which tokens are released all at once, are less likely to cause sharp price movements, while gradual releases like those are less likely to startle market sentiment but with the cumulative effect of potentially affecting it.
Potential Impact on Crypto Market
The total release of more than $759 million in tokens across the projects could be a trigger for the wide spread effect throughout the crypto market.
Tokens with a high percentage of unlocked supply, for example NEON and WLD, are the most at risk of a price decline if a high percentage of the unlocked supply comes out for sale, increasing selling pressure.
In the case the token holders choose to liquidate, these assets may be prone to unconventional volatility in the short term.
However, tokens that have limited the percentages of their released circulating supply, such as Solana and Dogecoin, may experience the least first-hand impact.
Even though supply is increasing, their lower unlocked percentages, backed up by continuing strong underlying demand, could help stabilize prices.
