In August, the expected volume of crypto token unlocks sees a steep decline to $3 billion, representing a 52% drop compared to the previous month. Nonetheless, several unlocks may still influence the market.
Major Token Unlocks in August
According to Tokenomist tracking data, major token unlocks in August include Sui (SUI), Fasttoken (FTN), Aptos (APT), Avalanche (AVAX), and Arbitrum (ARB). The largest unlock will occur on August 1, with Sui releasing $167.62 million worth of tokens. Despite a high valuation, only 34.5% of its supply is currently unlocked. This scenario poses risks if early holders decide to sell.
Reduced Volume Not Indicative of Market Slowdown
While a significant reduction in token unlock volumes is anticipated, experts suggest that this does not necessarily indicate a long-term market slowdown. Vincent Kadar, CEO of security token platform Polymath, stated that token unlocks often occur in cycles reflecting shifts in sentiment and market needs. "A 50% drop is notable, but not necessarily a sign of a slowdown," he noted.
Shifts in Investor Approach to Token Unlocks
Kadar also mentioned a shift in institutional investors' approaches to evaluating token unlocks. Previously, concerns about unlocks would lead to panic and volatility; now, the focus has shifted toward fundamental factors such as governance transparency and long-term viability. This shift presents overall benefits to the industry as projects increasingly engage with public markets.
The decline in token unlock volumes in August reflects current market trends but should not be interpreted as a signal of long-term stagnation. Investors are beginning to analyze the fundamental aspects driving token value more closely.
