Weekly token unlocks are a regular occurrence in the cryptocurrency market. These tokens are typically released to early investors, funds, and project teams. Upon receiving these tokens, some investors choose to sell them, either through market orders or limit orders. These sales can have a noticeable impact on the token's price. However, there are some key points to consider regarding token unlocks:
Market Reaction: It's common for every “guru” who trying speculate on the market's response to these future distributions. While some traders may try to accumulate on these events. Predicting market movements in response to token unlocks can be quite challenging.
Project Quality: High-quality projects usually plan their tokenomics meticulously to minimize the influence of early investors on the price. They design their token release schedules to prevent significant disruptions to the market.
Small Unlocks: In many cases, only a small percentage of total circulating tokens becomes available. When this percentage is low, it may not significantly affect the market. Selling pressure from a 1% or 3% unlock, for example, may not be substantial.
Unintended Reactions: Sometimes, the market reacts in unexpected ways to token unlocks. Prices might not immediately rise upon the unlock, and they can even experience downward movements. Breakouts do not always result in immediate asset sales. Or someone can sell before unlock and bring a fear, so at unlock this whales absorb all coins and push price back up.
Project Strategy: Occasionally, projects may opt to postpone large token releases that were anticipated. This delay can have unexpected consequences, such as liquidations of short positions, leading to significant price movements.
Every case is individual. You remember when DYDX postponed 1 year 15% unlock. But during this year price will stay in a same range. Or upcoming HFT unlock. If HFT was at 1$ price do you think its a smart idea for people who will get now some % from 15% supply sell now at 0.28? If they can just wait a bit and sell higher? Of course everything depends of personal situation. Some investor want out of project, some accumulate more, some need money NOW, someone can wait 1-2 year longer but with full amount of coins on wallet now.
Always just imagine, behind every unlock the same people like you. And ask yourself if you invest in some coin on early stage, you believe in potential of this coin. Now you got your coins from unlock period but price so low, and we are at the bottom will you press - SELL? I think not, because you understand the potential. Also you got a big bag of this coins and you better wait alt season for % step by step fixation with perfect average price. #Unlocks #cryptotalk
