GAL, DYDX, APT and BIT token unlocks are lined up in May amidst key macro events
|- Token engineers at 6thManVentures identify negative impact on token unlocks greater than 1% of the asset’s supply.
- GAL and BIT unlocks are 3.8% and 1.95% respectively, making it likely for these assets to experience higher volatility in prices post token unlock.
- GAL and BIT prices could nosedive on their unlock events on May 5 and 15, based on historical data on unlocks.
Crypto token unlocks are lined up in May, with Galxe (GAL), dYdX (DYDX), Aptos (APT) and BitDAO (BIT) unlocking their tokens between May 5 and 15. A team of token engineers and experts at 6thManVentures studied 5,000 token unlocks and identified a relationship between unlock events and asset prices.
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Upcoming token unlocks in May: GAL, DYDX, APT, BIT
Colin Wu, a Chinese journalist shared a list of key token unlock events scheduled to occur in May 2023. Of the ten unlocks, four are scheduled for the first two weeks of May, GAL, DYDX, APT and BIT in that order.
Large token unlocks in May
3.80% of GAL’s supply and 1.95% of BIT’s supply will be unlocked on May 5 and 15 respectively. These are the two most significant unlocks for the reason that the percentage of tokens being unlocked is greater than one.
According to a recent report by 6thManVentures, the team of token engineers deduced that “larger unlocks, those that increase circulating supply by greater than 1%, correlated to a noticeable, negative relationship: as unlock size increased, prices decreased.”
Based on the engineers’ deduction GAL and BIT token unlock events could negatively influence the two asset prices.
Report by 6thManVentures
In the case of DYDX and APT, upwards of 6.5 million and 4.5 million tokens will be unlocked respectively. These unlocks account for less than 1% of the token’s supply and are likely to have substantially lower impact on the token’s price and volatility.
DYDX has yielded over 5% gains for holders since Wednesday. If the asset’s price continues climbing until the unlock event on May 9, the unlock could turn out to be a sell-the-news event based on historical data.
GAL’s token unlock on March 30 turned out to be a sell-the-news event sending the asset’s price from $1.85 to $1.74. This represents a nearly 5% decline within hours of the token unlock.
Token unlocks could inject volatility into the crypto ecosystem during a week of macro importance. The US Federal Reserve raised interest rates by 25 basis points (bps) on May 3, a key data release, the Nonfarm Payrolls is expected on Friday, May 5.
The US Dollar Index and risk asset prices could witness a shift in response to the Nonfarm Payrolls data scheduled for release at 12:30 UTC on May 5.
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