Token Unlocks Report: How DeFi token unlocks influence cryptocurrency prices

Token unlocks data from the last year was examined to identify the market reactions to the various digital assets. The historical data review revealed that while some tokens experienced extreme price changes after release, several other tokens had a more balanced reaction in the market. 

Token unlocks during the last year significantly determined the price movements of cryptos launched in the ever-evolving Decentralized Finance (DeFi) space. The price changes varied widely, highlighting the unpredictable nature of crypto price movements. 

Crypto tokens exhibit extreme price movements after token unlocks

Historical data compiled by Token Unlocks revealed that some tokens had extreme price movements, with $PENDLE and $ENA experiencing the largest price fluctuations. $PENDLE experienced the largest positive price movement last year, with a 234% increase. 

The price increment occurred while the token only unlocked 4.2% of its total supply. The Token Unlocks report implied that the price increment attested to $PENDLE’s strong position in the crypto market, backed up by strong market confidence in the project.  

Conversely, the $ENA token experienced the largest negative price movement over the last year. The analysis revealed that $ENA’s price fell by 66.73% while only 2.9% of its supply was unlocked. According to the report, the decrease in the price of $ENA illustrates the volatile nature of token releases. 

The $RPL and $OSMO tokens also recorded significant negative price changes of -63% and -62%, respectively. $RPL and $OSMO had 4.3% and 4.9% of their respective supplies unlocked, respectively.

Also, $LDO’s price dropped by -52%, while $BAL dropped by -54.5%. $LDO and $BAL, respectively, had 0.009% and 6.5% of their total supply unlocked. The price drop came about despite the tokens having a very limited amount available to the public. 

Multiple factors influence token price after unlocks

Several tokens released over the last year had moderate price movements following unlocks. Tokens such as $AAVE experienced a 44% price gain after its unlock. The $AAVE token achieved this milestone with only 2% of its total supply in circulation. According to the report, the token’s price gain reflected its demand in the market. The high demand may have offset any downward pressure. 

$MASK had a similar moderate price movement, with a 35% price increase and 2.9% of its total supply. According to the report, $MASK and $AAVE’s price movements reflected investor confidence in their long-term value, keeping price volatility in check. 

Token Unlocks urged investors to consider other influential factors, such as timing, supply, and demand, in predicting token prices, adding that these factors make predicting future outcomes difficult.