Arbitrum’s Massive $107 Million Token Unlock Threatens To Send Price Below $1

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On April 16, Arbitrum (ARB) faces the possibility of experiencing a substantial price drop due to the upcoming release of its tokens. Historical data shows that such token unlock events can lead to increased market volatility as the consequences following their implementation are uncertain.

$107 Million Arbitrum Tokens Set To Be Unlocked

According to TokenUnlock’s data, approximately 92.65 million Arbitrum tokens, equating to around 3.49% of its total supply, are scheduled for release on April 16. Of this amount, over half or 56.13 million tokens (valued at roughly $65.10 million) will be allocated for the team, future team, and advisors. The remaining 36.52 million tokens ($42.36 million) are intended for investors.

After a token unlock event, the recipients often sell off large quantities of their tokens, leading to a significant price decrease. This could potentially happen to Arbitrum as well when its tokens are distributed. It’s important to note that this has been observed in the past, as Arbitrum experienced a substantial price drop during its previous token unlock on March 16.

According to CoinMarketCap’s data, Arbitrum’s price, which had closed the day before at over $2, fell to $1.8 on March 16. It’s important to mention that this month’s token release, which amounts to a relatively small number of Arbitrum tokens compared to last month’s unlock. In the previous month, approximately 1.11 billion Arbitrum tokens (around 41.9% of its current supply) were freed up for circulation.

In other words, even though the consequences of a sell-off could be less extreme than before, Arbitrum may still fall beneath the $1 mark for the first time in a while, given its current position near that support level.

Other Token Unlocks To Watch Out For

Approximately $76.96 million in Axie Infinity (AXS) tokens, which represents around 7.6% of the total circulating supply, are set to be released this week on April 17. Out of these tokens, 3.10 million will be allocated as rewards for stakers. Furthermore, 6.08 million tokens are designated for the development team, and an additional 1.69 million tokens will be added to the ecosystem fund.

Simultaneously, similar to Arbitrum, Apecoin (APE) is a token facing the possibility of falling below $1 due to the upcoming unlocking event on April 17. Approximately $18.57 million worth of Apecoin tokens (representing around 2.48% of the circulating supply) will be released, with most of these tokens being allocated to Yuga Labs’ founder. If Apecoin experiences a significant price decrease, it could intensify the pessimistic view of the Yuga Labs ecosystem as the Bored Ape NFT has already dropped 90% from its peak value.

Arbitrum’s Massive $107 Million Token Unlock Threatens To Send Price Below $1

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2024-04-16 17:10