What is this anyway? Unlocking is the unlocking of coins that were purchased by investors in the early stages, long before listing on exchanges. These primary investors receive a certain number of coins for their money, but cannot sell them until a certain point.

There are different unlocking schemes. For example, in the classic version, investors are simply allowed to sell some part of the received coins. But for projects like Aptos and Flow, everything is a little different: the total number of coins remains locked for 2-3 years, but approximately once every 1-3 months the interest accrued for staking occurs. And these are just a few examples! There are a lot of different schemes, and you need to understand them - all this information is usually indicated in the project’s tokenomics and is available in the public domain.

Now to the myths. I often hear the story: “tomorrow there will be unlockings, and the price will fall,” or vice versa, “tomorrow there will be unlockings, and the price will rise.” But figs there! 😆 The question should be posed differently: “how will the unlocking affect the balance of supply and demand?” This is how you will understand where to dig.

The first thing you need to understand is whose coins are locked there. If these are funds, they may not sell coins at all if the current price is not very different from their purchase price. And if these are private investors, then get ready: most likely, they will immediately throw coins into the market, increasing supply at the same level of demand.

If there are few private investors, large funds can buy their coins to knock out weak hands. In this case, the balance of supply and demand will remain the same, as will the price.

Before unlocks, the media often fuels interest in the coin, increasing demand. At the moment of unlocking, there may be a pump, which immediately fades away when the funds unload coins onto the newly arrived hamsters.

Dozens of examples can be given, but it is more important to get the essence. To understand how the price will react, you need to conduct analytics. It is important to know whether the current price is profitable for funds to sell, whether there has been any noise in the media, what kind of unlocking system and what percentage will be released to the market, and who owns the locked coins.

And, as always, think and analyze. Understand the meaning and logic of the process, and don’t just read the headlines and run to sell or buy.

IMPORTANT: Usually this all leads only to local, short-term swings, and not to serious price changes. You should not take hasty actions if you have long-term plans for the coin.

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