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Cryptocurrency Prices Under Pressure as $2 Billion Altcoin Unlocks, $11 Billion Bitcoin (BTC) Deployment Looms
Cryptocurrencies are still stuck in a corrective phase, but a wave of supply events worth billions of dollars could further delay any significant recovery.
“A rapid succession of nearly $2 billion in token unlocks over the next ten weeks could lower the altcoin market,” noted crypto analytics firm 10x Research in a report on Wednesday.
Large token unlocks in cryptocurrencies are usually bearish events, which increase supply by distributing assets previously locked in vesting contracts to team members, organizations, and early investors, including venture capital firms.
Over the next two months, about $97 million in aptos (APT)$79 million worth of Starkware (STRK)$94 million in arbitration (ARB)Immutable X’s $53 million (IMX)Avalanche’s $330 million (AVAX)64 million dollars of optimism (OPERATION)28 million dollars of PRIME, almost 1 billion dollars of sui (SUI)$48 million ethena (ENA), according to the data collected in the report, $171 million of Altlayer ALT and $135 million of XAI tokens will be put into circulation.
“Venture capital investors may be pressured to lock in recent gains, which could limit any upside performance of tokens with positive momentum, particularly those where unlocks become available,” the report said.
Bitcoin worth over $11 billion (BTC) will be distributed to creditors of cryptocurrency exchange Gemini’s Earn program and long-defunct cryptocurrency exchange Mt. Gox, K33 Research analyst Velte Lunde warned in a Tuesday report.
“The next few months are set to see waves of good old crypto FUD,” Lunde said, referring to the popular cryptographic acronym out of fear, uncertainty and doubt.
Among upcoming supply events, one market observer suggested that FTX redemptions could offer some relief.
Pending bankruptcy court approval, about $14-16 billion of U.S. dollar funds could be paid to creditors, and a good portion of it could return to the cryptocurrency market, said Arthur Cheong, founder and chief investment officer of DeFiance Capital.
“Expect at least $3-5 billion of crypto-native liquidity to be pumped back into the market,” Cheong said in a X post Wednesday.
Late in the US day, the broad CoinDesk 20 index fell 3.4% over the past 24 hours, with bitcoin down 2.5% at $61,500 and ether (ETH) lower by 3.6%. Bitcoin Cash (BCH) and Solana (SOL) were the index’s worst performers, each down more than 7%.