Why is token unlocking important to care about?

Are you unfamiliar with the term “unlocking” the cryptocurrency market? If you are an investor who intends to deeply understand the market, unlocking the possible impact on the price of tokens is an event that you must pay close attention to.                           

What is token unlocking? When each project issues native tokens, they are usually allocated to developers, early investors, etc. in proportion. This is the token distribution model. In order to avoid the tokens encountering huge selling pressure when the project is launched, many projects will set up A "lock-up period" is set to lock the tokens held by relevant persons for a period of time so that they cannot be traded immediately. Then at a specific point in time, these tokens will be partially unlocked, allowing holders to trade freely.                           

This is a price protection mechanism for the project, but for investors, a large number of token unlocks may put pressure on currency prices. For example, at the end of last year (2023), $DYDX unlocked a value of approximately $485 million. The price of the token immediately plummeted by nearly 5% in a single day, and the decline continued for several days. However, there are also cases where the price did not fall as expected after the unlocking was completed, but rose instead. For this reason, investors need to make their own decisions whether to rise or fall. Good research.                   

After understanding the possible impact of unlocking, it is inevitable to introduce a useful tool - "Token Unlocks". This is a practical data providing website. You can see the upcoming unlocking schedule of various tokens, as well as the circulation volume, unlocking quantity.​

So let’s take a look at which tokens will be unlocked this week!​

AltLayer（$ALT）

  • Total market capitalization: US$274 million

  • Unlocking time: 18:00 on June 25th

  • Amount of unlocked tokens: 105 million, worth approximately US$19.88 million, accounting for 6.92% of the circulating supply

Yield Guild Games（$YGG）

  • Total market capitalization: US$218 million

  • Unlocking time: 22:00 on the evening of June 27th

  • Amount of unlocked tokens: 16.69 million, worth approximately US$10.65 million, accounting for 4.48% of the circulating supply

Optimism（$OP）

  • Total market capitalization: US$1.933 billion

  • Unlock time: 8:00 am on June 30th

  • Amount of unlocked tokens: 31.34 million, worth approximately US$56.1 million, accounting for 2.88% of the circulating supply

Sui ($SUI)

  • Total market capitalization: US$2.101 billion

  • Unlock time: 8:00 am on June 31st

  • Amount of unlocked tokens: 64.19 million, worth approximately US$57.15 million, accounting for 2.65% of the circulating supply