Altcoins
DYDX to unlock millions of tokens in December – Should traders be cautious?
DYDX will unlock tokens worth more than $500 million on 1 December 2023. Ahead of the event, market indicators turned bearish.
- During the last token unlock, DYDX’s price action did not turn bearish.
- DYDX was down by more than 4% in the last 24 hours, and negative sentiment around it was dominant.
Dydx [DYDX] is expecting its next token unlock, which will inject tokens worth hundreds of millions of dollars into the market soon. Such a massive jump in circulating supply can have a negative impact on the token’s price action.
Therefore, to better understand what to expect, let’s have a look at past data.
All about DYDX’s upcoming token unlock
According to Lookonchain’s latest tweet, Dydx will unlock 150 tokens, which are worth more than $500 million, on 1st December 2023. Out of which, $280.35 million will be available for investors.
Apart from DYDX, Optimism [OP], Hedera [HBAR], and Sui [SUI] are also expecting a next round of token unlocks over the coming days.
dydx will unlock 150M $DYDX($505.5M, 81.63% of Cir. Supply) on Dec 1, of which 83.19M $DYDX($280.35M, 46.15% of Cir. Supply) unlocked to Investors.
Will unlocking bring huge selling pressure?
Did whales/SmartMoney buy or sell $DYDX?
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Here is what you need to know. pic.twitter.com/FszV999TIX— Lookonchain (@lookonchain) November 27, 2023
Token unlocks are often followed by price drops because of the demand and supply theory. Whenever a token’s circulating supply rises, its demand drops, causing its price to plummet for a short period of time.
However, when DYDX unlocked its tokens last time, things did not go the bad route. DYDX last witnessed a token unlock on 31st October, 2023.
AMBCrypto’s look at Santiment’s data further revealed that DYDX’s price was not affected much. Rather, its value started to pump a few days after that, thanks to bullish market sentiment.
However, it should be noted that negative sentiment around the token spiked during the previous unlock.
Source: Santiment
What to expect from DYDX
Since this time the blockchain will be unlocking a massive number of tokens, the probability of DYDX’s price plummeting seems high.
Market sentiment around the token also looked bearish, which was evident from its low weighted sentiment. But its social volume was high, meaning that DYDX remained a topic of discussion in the crypto space.
Source: Santiment
According to CoinMarketCap, DYDX was down by more than 4% in the last 24 hours.
At press time, it was trading at $3.17 with a market capitalization of over $582 million. Things can get worse even before the token is unlocked, as market indicators look bearish.
Read Dydx’s [DYDX] Price Prediction 2023-24
Its MACD displayed a bearish crossover. Both Money Flow Index (MFI) and Chaikin Money Flow (CMF) went down, which increases the chances of a continued downtrend.
Therefore, investors must remain cautious before making a decision on DYDX ahead of its upcoming unlock.
Source: TradingView
