The post Token Unlocks: Your Crucial Guide to This Week’s Potential Volatility appeared on BitcoinEthereumNews.com.

Hey crypto enthusiasts! Ever wondered why the price of a token suddenly dips or gets volatile even when the broader market seems stable? Often, the answer lies in something called a token unlock. These scheduled events can significantly impact a token’s circulating supply and, consequently, its market dynamics. This week is no exception, with several notable crypto unlocks on the horizon that you should definitely be aware of. What Exactly Are Token Unlocks and Why Do They Matter for Crypto Market News? Think of a token unlock as the opposite of a lock-up period. When a cryptocurrency project launches, a large portion of its tokens is typically allocated to founders, the team, advisors, private investors, and for ecosystem development. To prevent these large holders from dumping all their tokens onto the market at once – which would crash the price – these tokens are usually locked up for a set period, often released gradually according to a predetermined crypto vesting schedule. When a token unlock occurs, a certain amount of these previously locked tokens becomes available to their holders. This matters for several key reasons, making it crucial information for anyone following crypto market news: Increased Selling Pressure: Holders who receive unlocked tokens, especially early investors or team members, might choose to sell some or all of their allocation to realize profits or cover operational costs. This influx of tokens hitting exchanges can increase selling pressure. Supply Inflation: Unlocks increase the circulating supply of a token. Basic economics tells us that if demand remains constant while supply increases, the price tends to decrease. Market Sentiment: Large, upcoming unlocks can create anticipation and sometimes fear (FUD) in the market, influencing trader behavior even before the unlock happens. Opportunity: Conversely, if the market anticipates selling pressure and the price dips, it could…

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Filed under: News - @ May 5, 2025 12:23 pm