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Keyrock Analyzed 16,000+ Token Unlocks and Concluded…Keyrock’s intriguing study examined how token unlocks affect token prices and which trader strategies lead to price increases or declines.
Let’s break down the key points and understand why 👇
A Bit About UnlocksEvery week, tokens worth more than $600 million enter the crypto market due to unlock events.
These unlocks don’t just jolt the market; they also set new price trajectories for various projects.
What You Need to Know:1️⃣ 90% of unlocks put downward pressure on prices, regardless of their size or category
2️⃣ The impact begins 30 days before the event, as participants start hedging
3️⃣ Large unlocks cause price drops 2.4 times more severe than smaller ones
4️⃣ Team unlocks hit the market hardest, with price drops averaging -25%.
But there are exceptions: ecosystem development unlocks can sometimes even bolster the token’s price, with an average increase of +1.18%.
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Why Are Unlocks So Important?For traders, these events serve as beacons, warning of incoming waves 🌊🗼
An unlock means a large number of tokens enter circulation, increasing market pressure.
To understand the exact price impact, consider two key factors:1️⃣
The size of the unlock relative to the total supply
2️⃣ The category of the token recipients
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Size MattersThe bigger the unlock, the harder it “hits” the market.
Analysis of over 16,000 cases showed:
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Small unlocks (less than 1% of supply) exert only minimal pressure
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Large events (5–10% of supply) lead to sharp price drops and increased volatility.
Interestingly, “huge” unlocks (more than 10% of supply) can have less noticeable immediate impact since their effect often plays out over time.
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Note:A good time to enter a position is about
14 days after a major unlock, when the market begins to stabilize.
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Who Gets the Tokens?This is as important as the unlock size. Here are the main recipient categories and their impacts:
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Project Team: The most destructive unlocks for price—drops up to -25%. Often due to mass selling without any strategy.
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Investors: Negative impact is present but less pronounced, as large investors use sophisticated strategies (like OTC deals or options).
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Ecosystem: Potentially the only category that can have a positive effect on the token’s price.
Why This Matters:Unlocks for the team or investors could signal a good time to exit, while ecosystem unlocks might indicate long-term growth potential.
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How Does the Market React?Token unlocks aren’t just technical events; they’re powerful market drivers.
Ignoring unlock schedules means missing out on crucial analytical insights.
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What Does Keyrock Recommend? 🟡 Always review unlock schedules before investing in a token
🟡 Consider both the size of the event and who’s receiving the tokens
🟡 The optimal time to enter is about 14 days after a major unlock
🟡 Avoid tokens with frequent team or investor unlocks
Understanding unlock dynamics not only helps protect your capital but also reveals opportunities for profitable trades.
In short, analyze, track, and take action! ❤️🔥Crypto Showcase 💸