AVAX Slips, Adding Tension To $365 Million Avalanche Token Unlock Drama
February 21 2024 - 10:05AM
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The price of Avalanche’s AVAX token has dipped by 11% in the past
week, bucking the bullish trend in the broader cryptocurrency
market. This comes amidst a $365 million unlocking event that
increased the token’s circulating supply by 2.6%. Experts suggest
both short-term challenges and long-term opportunities for AVAX.
Unlocking Event Triggers AVAX Price Dip Source: Token.Unlocks
Token.Unlocks data indicates that on Thursday, locked-up tokens
valued at approximately $303 million will be released from vesting
and put into circulation. On February 15th, a significant unlocking
event saw 9.5 million AVAX tokens, worth roughly $365 million,
released from a vesting period. This influx of previously locked-up
tokens coincided with a price decline for AVAX, which fell from
$40.32 to its current price or nearly $37. This aligns with
historical trends, as a 2023 report by The Tie found that large
unlocking events often lead to price drops within two weeks due to
supply outpacing demand. AVAX price in the red. Source: Coingecko
Analyst Opinions Diverge Despite the recent dip, some analysts
remain optimistic about AVAX’s future. The Tie’s report, while
acknowledging the short-term price pressure, highlights the
Avalanche network’s growing activity, fueled by popular NFT
collections like Dreamheadz and Dokyoworld. The increased
engagement within the NFT space is seen as a positive indicator for
long-term adoption and potential price appreciation. TSM’s
@theblitzapp Subnet launched, where all premium subscriptions on
the platform now flow on-chain, with more features to come later in
Q1 https://t.co/dTb52vkFlw — Avalanche 🔺 (@avax) February 5, 2024
Furthermore, analysts point to AVAX’s outperformance compared to
specific peers like Celestia and Solana in recent days. This
suggests some resilience in the face of the unlocking event and
potential buying pressure despite the overall price dip. Some
analysts even predict a possible climb to the $40 mark by the end
of February, although this remains speculative. Avalanche (AVAX) is
currently trading at $36.95. Chart: TradingView.com Market
Sentiment And Broader Trends It’s important to remember that the
cryptocurrency market is inherently volatile, and AVAX’s price will
be influenced by various factors beyond the unlocking event. The
overall market sentiment, regulatory changes, and broader economic
trends can all play a significant role. Investors should conduct
thorough research and consider their own risk tolerance before
making any investment decisions. AVAX price retreating today.
Source: Coingecko The recent unlocking event has undoubtedly
impacted AVAX’s price in the short term. However, analysts remain
divided on the token’s future trajectory. While some anticipate
further price declines due to the increased supply, others
highlight positive developments like the network’s growing NFT
activity and potential for a rebound. Related Reading: Ethereum
Bullish Run: Analyst Eyes $4,500 After ETH Breached $3K Featured
image from Pixabay, chart from TradingView
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