In the usual state of the market, token unlocks—where tokens that were previously vested or locked are released into circulation—are tied to concerns about sell pressure and dilution.

But the current bull market seems to be rewriting that narrative. We are in the midst of a fresh wave of token unlocks across various crypto projects. And instead of causing the market to dip, these unlocks seem to be coinciding—with not just a halting in negative price action—but also with some significant rallies in various projects.

The most recent data points to eight tokens that have enjoyed recent unlocks and yet have posted impressive gains even as their supply has increased. This is a development that highlights a larger truth taking shape in this market cycle: when strong market sentiment, solid fundamentals, and a dedicated community are behind a given token, the unlock event serves as a catalyst rather than a headwind.

WLD and ENA Absorb Heavy Emissions Without Breaking Stride

Some of the most outstanding cases are Worldcoin and Ethena—two tokens that soaked up nine-figure unlock values and still ended up trading much higher post-unlock. WLD unlocked 10 percent of its supply, representing a quite significant new token dilution of 241 million dollars. Rather than succumb to this wave of new tokens, WLD somehow managed to stay afloat, and even much better than afloat, trading around 80 percent higher than the day before the unlock.

In the same way, ENA confronted the issuance of approximately 711 million dollars’ worth of tokens, representing 2.95 percent of its supply. In what plenty of onlookers deem a wake-up call to the market, the tokens issued to early investors and to some investors who helped fund the project were a huge surprise—and not a pleasant one. They were not mentioned in the project’s prospectus (a summary of the project’s vision and value that is supposed to be delivered to potential investors). Despite all that, investor demand for ENA remained exceptionally strong. After the release, many investors who were holding ENA tokens expected that value was going to be delivered and pretty soon.

Lower-Cap Names Outperform With Limited Emissions

Some of the more mind-blowing gains have come from tokens with low unlock values and smaller market caps. Positioning themselves as a lead, Parcl’s price has exploded upwards following its unlock event. They saw a 93.6 percent price increase post-unlock event that was worth a modest amount of 2.74 million dollars (that’s 6 percent of the overall token supply).

Athena and io.net made outsized moves as well. ATH jumped 76 percent after a 2.84 percent unlock worth 13.2 million dollars, while IO took off, 60 percent up from a 4.8 percent unlock worth 7.4 million dollars. These results showcase the advantages smaller projects have in soaking up unlocks, especially in a market obviating bullish overtones and stuffed with positive sentiment. With such an atmosphere, and with such our two unlocking projects, there exists less supply to manage, less problem with a market structure dominated by whales, and thus, more ease in achieving a sort of price appreciation that would not give even our last down-under President an air of understatement.

Unlock Resilience Tied to Narrative, Not Just Numbers

The most important thing to glean from the data is that merely having a high unlock percentage is not enough to be bullish on a project’s price action. Unlocks like what we just witnessed with Morpho show this clearly. They unlocked a whopping 10 percent of their supply (around 50 million dollars in tokens), and their price skyrocketed 70 percent. This shows the power of having a strong narrative and community in today’s market.

Other tokens with higher circulating floats, like Aptos and Starknet, also managed unlocks well. APT had 1.8 percent of its supply unlocked, which was worth about 64.5 million dollars, and it rallied 45 percent. STRK had 4 percent of its supply unlocked—around 22.75 million dollars worth—and moved up by 22.8 percent. These tokens seem to have received boosts from their liquidity profiles and market maturity, which allowed them to absorb emissions with a good deal less volatility than other tokens in this rundown.

The market indicates that there is no clear linear connection between unlock percentage and price movement. Factors that hold far more sway in determining price are the following:

– Circulating float

– Project fundamentals

– Timing

– Investor sentiment

We are in a very strong bull market, and it seems like everything is working in favor of prices. Even token unlocks—which, in a bear market, would probably be seen as negative events—are getting viewed as bullish.

Tokens might be rewarded for releasing supply. If this trend keeps up, the current cycle might represent a turning point in investor perception regarding unlocks.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

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The post Token Unlocks Defy Expectations as Bull Market Momentum Drives Prices Higher appeared first on The Merkle News.

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Filed under: Bitcoin - @ May 30, 2025 5:28 am