This week sees five different altcoin projects releasing a combined total of $167 million worth of tokens into their projects' circulating supplies. BitDAO, ApeCoin, 1inch, Oasis Network, and ImmutableX will unlock 420 million tokens in the market. This influx of tokens affects the asset's supply and demand dynamics, which often leads to major selloffs.

However, the consequence of each project's token unlocks depends on its contribution to the overall available supply. Yesterday, BitDAO unlocked 187,499,999.36 tokens, which amounted to 2% of the total supply. Afterward, the token's price rose from below $0.50 to above $0.52, implying a considerable demand for the asset.

ApeCoin's release will contribute 1.56% to its initial supply, and Oasis Network will add almost 2%. ImmutableX's circulation increase amounts to 0.9% of the total IMX supply, and 1INCH unlock will contribute a modest 0.001%.

It is worth noting that investors may sell their assets before the unlocks to preemptively prepare for the projected supply increase. This behavior is frequently seen when APE peaked to $3.46 before its token unlock and suddenly dropped to $3.42 as its release date draws closer.

Responding to these market fluctuations, many crypto projects have implemented vesting schedules to regulate their token supplies. Much like stock vesting schedules in traditional finance, these schedules guarantee that early investors benefit from their investment in the long-term. Usually, tokens are locked for an average of 1-5 years before they become eligible for the unlock.

In conclusion, the tokens unlocked this week could cause considerable price movements, depending on the contribution of each project to the tokens' overall supply. At the same time, by implementing vesting schedules, these projects can mitigate potential supply shocks and ensure their token's price stability.



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