Among the major players in the decentralized finance (DeFi) and Web3 arenas, Avalanche stands out as a prominent layer-1 blockchain solution. However, it’s gearing up for a potentially momentous shift in its market dynamics come August 26. A substantial number of tokens, precisely 9.54 million AVAX, valued at an impressive $101.14 million as per the latest market rates, are slated to be released into circulation.
While it might seem like a minor detail in the broader picture, these unlocking tokens represent a significant 2.77% of Avalanche’s current circulating supply of 344.05 million AVAX. To put this in perspective, the 24-hour trading volume of AVAX was recently reported at $83 million. The upcoming token release surpasses this daily trade volume, suggesting potential notable shifts in the market.
Speculations are rife that this could lead to a pronounced sell-off, pushing the price of the AVAX token even lower, especially in these unpredictable market times. Such substantial token releases could sometimes lead to short-term panic selling, although long-term impacts might vary based on overall market sentiment and the project’s fundamental strengths.
In the distribution, strategic partners would receive 23.5% of the locked tokens, amounting to around 2.25 million AVAX or approximately $23.99 million. The Foundation, accounting for 17.5% of the released tokens, is slated to be granted roughly 1.67 million AVAX, equating to about $17.77 million.
The core team of Avalanche would secure the largest portion, with 47% of the tokens, valuing around $47.97 million or 4.5 million AVAX. The remaining 12% of the tokens, which is about $11.99 million or 1.13 million AVAX, would be allocated for an airdrop distribution. This allocation breakdown ensures a strategic and balanced distribution of AVAX tokens among key stakeholders.
Interestingly, Token Unlocks, a platform that tracks unlocks of token events, has pegged Avalanche’s yearly inflation rate at a notable 24.5%. This rate is indeed significant and might provide investors and market analysts with much to ponder upon in the upcoming days. At the time of writing, AVAX is at $10.59, with a 24-hour decrease of 2.55%. The price trend of AVAX has been largely in the red over the past week, with a month-long decline of over 24%.
In conclusion, as August 26 approaches, all eyes are on Avalanche and the broader market. While predictions abound, only time would reveal the actual consequences of this month’s token release. Stakeholders, traders, and enthusiasts would do well to stay informed and tread cautiously.
