Avalanche (AVAX) Faces Challenging Week with Massive Token Sell-Off
Avalanche (AVAX) is set to experience a challenging week ahead as nearly $400 million worth of tokens are set to be sold off. These tokens are part of the unlocks from the Genesis distribution, which follows the proof-of-stake (PoS) issuance. On February 21, vesting contracts will release 9.54 million AVAX tokens, equivalent to $376.61 million at current prices.
Avalanche Token Sell-Off Distribution
The distribution of the sell-off will see the ‘Team’ receiving 47% of this year’s half unlock. This means that team members will be able to liquidate 4.50 million AVAX, valued at $177.62 million. Additionally, ‘Strategic Partners’ and the ‘Foundation’ will increase their treasury by 2.25 million and 1.67 million AVAX respectively, potentially leading to a future sell-off threat of over $154.6 million.
Furthermore, there will be a liquid unlock of 1.13 million AVAX ($44.40 million) for community airdrop.
AVAX Price Analysis
As of now, AVAX is trading at $39.46 per token. The token has experienced significant growth since October 2023 due to the surge in funds locked in DeFi projects.
However, history shows that AVAX was negatively impacted during the last token unlock on August 26. The previous sell-off resulted in a drop from $12.88 (August 1) to $10.81 (August 29), and further down to $8.90 on September 23.
Proceed with Caution
Given the volatile and unpredictable nature of the crypto market, Avalanche investors and traders should approach the upcoming days with caution. The massive unlock has the potential to trigger a significant sell-off that may impact AVAX’s short-term prices.
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