TIA Faces Market Uncertainty Ahead of Token Unlock Event

Upcoming token unlocks for TIA, despite its 1x rally since listing, have sparked concerns in the market. The project’s circulating market cap currently represents only 20% of the total supply, highlighting the potential impact of the unlock on token price.

The unlock event, scheduled for October 31, will release 175 million TIA tokens (16.5% of the total supply). This will be followed by daily releases of 1 million tokens starting November 1, resulting in a nearly 390% increase in total supply.

This significant influx could exert downward pressure on the token’s price if demand doesn’t rise proportionally. Market commentators worry about the potential for token dilution, especially if the market struggles to absorb the increased supply.

The increased supply could also improve liquidity, but the risk of dilution remains a key concern. If new buyers don’t enter the market, the token’s value could suffer.

On a positive note, the vesting schedule seems designed for long-term sustainability, with a gradual token release over several years. This may help mitigate some short-term risks. Additionally, governance mechanisms controlling certain token releases could prevent immediate market disruptions.

However, with a major unlock on the horizon, investors are closely watching how the market reacts to the increased supply. The ability of $TIA to navigate this potential challenge will be crucial for its future performance.

Read also: Celestia (TIA) Price Prediction 2024-2030: Will TIA Price Hit $50 Soon?

Celestia trades at $4.17, rallying 3.70% in the recent intraday session. It is currently trading 124,862.72% above the 200-day SMA of $0.003332. Additionally, TIA is trading near its cycle high of $4.22.