Based on past price movements, it’s highly likely that investors will interpret the unlock as a positive trigger for bullish sentiment.
The token unlock of 9.54 million AVAX tokens ($382 million) by the Avalanche Network on February 22 has raised huge interest and scrutiny among the crypto community at large.
The investors will be compelled to follow past experiences and present trends in order to understand the implication of the event on the AVAX prices and the investor sentiment.
Knowing the historical context of Avalanche token unlocks, especially the major event in November 2023, helps our understanding. The remarkable 150% price upsurge that was ignited by the prior unlock was something that went against the typical assumption of a sell-off.
Market Sentiment and Expectations
The prevailing market sentiment about the approaching unlock event is a tentatively optimistic one, driven by the previous performance.
Nowadays investors are waiting for the predicted price pumps rather than for an immediate dump. However, within the same optimism, lies the broader market and its possible influence on the AVAX price movement.
Unlock Details and Distribution Channels
After the token unlock, the Avalanche team is set to get 47% of the tokens, which is equivalent to a potential sale of 4.5 million AVAX, valued at 177 million dollars.
Further to this, Avalanche’s strategic partners are to buy 2.25 million AVAX tokens. Moreover, the foundation treasuries will get 1.67 million AVAX, and the community will have 1.13 million AVAX tokens.
Presently, AVAX is being traded at around $40 with a market cap of $13 billion.
After the unlocking, the distribution dynamics of AVAX tokens will be the key for market stability and investors’ sentiments. With the Avalanche team holding a significant portion of tokens, the questions on their selling behavior and its impact on the AVAX prices come in.
Derivatives Market Activity and Future Projections
Derivatives market around AVAX is an excellent indicator of the future price movements.
Traders’ positions and opinions in Avalanche (AVAX) derivatives can be used in forecasting the price movements.
Introducing the data into the price prediction models of AVAX improves the accuracy and reliability of the models in a volatile market environment.
Hence, the derivatives market activity should be thoroughly evaluated to build strong AVAX price predictions.
Final Words
With the Avalanche token unlock date drawing nearer, the crypto community holds their breaths, watching the next step of AVAX in the marketplace.
A historical performance is an important part of the guide but the market is multidimensional and thus the future price prediction of AVAX should be taken with a pinch of salt.
By employing prior experiences, analyzing current equality metrics and taking into account derivative markets, investors will go through the thin ice of AVAX’s token economies with more confidence.
