Today, PYTH will be unlocked in large quantities. Pyth Network tokens will unlock 2.13 billion at 22:00 on May 20, worth about 812 million US dollars, accounting for 141.67% of the circulation. So is it really as we see it? Is it a good thing to short now? I can only say that you think too much~
If you look closely at the token distribution in Tokenomics, you will find that there are five different distribution objects.
First, the rewards for data publishers account for 22% of the total number of tokens, and these tokens are directly rewarded to data publishers. In the future, publishers may need to stake their PYTH tokens to continue publishing data. In this way, the community can also supervise data publishers to a certain extent. Even if publishers need to unlock this part of the tokens to their accounts, they also need to stake, so this part of the tokens will not have a significant impact on the market environment.
The second part, what we call ecological growth, accounts for 52% of the tokens, which is almost half of the tokens related to ecological growth. All incentive plans come from this part, including rewards for ecosystem contributors, such as data publishers and downstream institutional protocols. These incentive plans are gradual, and even if there are token unlocks, they will not be issued all at once.
Most of the tokens related to ecosystem growth are not issued to individuals, but to ecosystem builders or institutions. These participants have long-term cooperation plans, such as some DeFi protocols that have been using Pyth services and receiving ecosystem growth rewards. In the future, they will also feed back to the use of Pyth through staking and other methods, so in theory there will be no pressure to sell in large quantities.
The other two parts include the tokens required for protocol development, accounting for 8.5%, and the private sales part accounting for 10%. Even if a large part of the liquidity is about to be unlocked, I don’t think this will have a significant impact on the market due to the native demand behind these token allocations. Even if there is an impact, it is a long-term process, so it is not an issue we need to pay special attention to.
