finbold.com
The cryptocurrency industry will unlock nearly $230 million in vested tokens this week, sounding an alarm to these diluted cryptocurrencies. These unlocks will happen after a volatile week, with most digital assets experiencing a massive crash in the price.
Looking for insights, Finbold turned to TokenUnlocksApp on August 10, spotting 14 cryptocurrencies with an unlock schedule for this week. Notably, $229.77 million in tokens will reach the market in the next seven days, likely creating relevant selling pressure.
In particular, three cryptocurrencies accrue for 76% of all the unlocks, releasing $174.96 million worth of their native tokens.
These crypto unlocks release previously illiquid tokens, usually in vesting contracts, inflating the circulating supply and creating sudden selling pressure. Usually, the involved entities receive the unlocking promise within the project’s initial distribution and have to wait for the schedule to sell and realize the promised value.
Aptos (APT) monthly token unlock
On August 12, Aptos (APT) will unlock 11.31 million APT, worth $66.95 million. This amount represents a 2.4% supply increase, part of Aptos’s monthly unlocks that result in nearly 28.8% annual inflation.
Notably, the same amount was worth $66 million and $103.48 million in previous unlocks in July and June, respectively. The decrease in value from the same amount of unlocked tokens evidences the economic effects of such high inflation.
The Sandbox (SAND) expected selling pressure
However, The Sandbox (SAND) will be mostly affected by this week’s cliff unlocks. The mid-cap cryptocurrency will release 205.59 million SAND, worth over $54.96 million, on August 14.
Despite having a lower nominal value than Aptos, The Sandbox’s unlock represents 9% of its current capitalization. Thus, this sudden dilution will flood the market with new tokens, with a potentially high impact on SAND’s price.
Arbitrum (ARB) supply inflation
On August 16, Arbitrum (ARB) will unlock $53.05 million worth of 92.65 million tokens for a 2.8% monthly inflation.
This represents an 18.5% loss from the same unlocked amount in July, worth $65.02 million, as Finbold reported. In June, the same token amount was worth more than $85 million—also reported here—for 37% losses in two months.
As things develop, traders will speculate and try to price these token unlocks on each of these inflated cryptocurrencies. This could bring huge volatility for APT, SAND, and ARB, with an increased downside potential.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.