Why is token unlocking important to pay attention to?

Are you unfamiliar with the term 'unlock' in the cryptocurrency market? If you plan to delve deeper into the market as an investor, the potential impact of unlocking on token prices is an event you must closely monitor.

What is token unlocking? When each project issues its native tokens, they are usually proportionally allocated to developers, early investors, etc., which is the token distribution model. To avoid significant sell-off pressure on tokens at the project's launch, many projects set a 'lock-up period' to lock the tokens held by relevant parties for a period of time, preventing immediate trading. Subsequently, at specific points in time, some of these tokens will be unlocked, allowing holders to trade freely.

This serves as a price protection mechanism for the project, but for investors, a large amount of token unlocking may pressure the token price. For example, at the end of last year (2023), $DYDX unlocked tokens valued at approximately $485 million, which caused its price to drop nearly 5% in one day, and the decline continued for several days. However, there are also cases where the price did not drop as expected after the unlocking ended, but rather increased, so whether it rises or falls requires investors to do their own research.

After understanding the potential impacts of unlocking, it's necessary to introduce a useful tool—'Token Unlocks', which is a practical data-providing website where you can see the schedules of various tokens about to unlock, as well as their circulating supply and unlock amounts.

Now, let's take a look at which tokens are about to unlock this week!

Arbitrum ($ARB)

  • Total Market Cap: $4.172 billion

  • Unlock Time: December 16, 21:00

  • Unlock Token Amount: 92.65 million, valued at approximately $94.41 million, accounting for 2.26% of circulating supply

ApeCoin ($APE)

  • Total Market Cap: $1.175 billion

  • Unlock Time: December 17, 20:30

  • Unlock Token Amount: 15.6 million, valued at approximately $25.12 million, accounting for 2.16% of circulating supply

QuantixAI ($QAI)

  • Total Market Cap: $432 million

  • Unlock Time: December 18, 08:00

  • Unlock Token Amount: 232,300, valued at approximately $22.31 million, accounting for 5.16% of circulating supply

Cardano ($ADA)

  • Total Market Cap: $38.725 billion

  • Unlock Time: December 18, 08:00

  • Unlock Token Amount: 18.53 million, valued at approximately $20.27 million, accounting for 0.05% of circulating supply

[Disclaimer] The market carries risks, and investments should be made cautiously. Analyst opinions are for reference only; users should consider a more diverse set of indicators to determine whether to invest and whether any opinions, views, or conclusions in this article align with their specific circumstances. Invest at your own risk.

'Total selling pressure exceeds $100 million! This week, 'these 4 coins' will have large unlocks, be cautious of risks if you have bought' was first published in 'Crypto City'