dYdX price dips as $505 million worth of tokens hit the market dYdX price dips as $505 million worth of tokens hit the market
The token unlock has resulted in dYdX price falling by around 5%.
2 min read
Updated: Dec. 1, 2023 at 12:43 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Decentralized finance (DeFi) protocol dYdX unlocked 150 million tokens earlier today, leading to a nearly 5% drop in its price during the past day despite the broader positive trend in the crypto market.
$500M tokens unlocked
The unlocked tokens, valued at $505 million, represent 81.63% of the circulating supply. Analysts anticipated the long-awaited unlocking would exert significant selling pressure on the token.
Of the 1 billion dYdX tokens, 50% is allocated to investors, founders, employees, and other insiders. The recent unlocking of 150 million tokens constitutes 30% of the allocation for these insiders.
On-chain data reveals that the dYdX foundation has been distributing tokens to investors like a16z, Polychain Capital, and Defiance Capital since 2021. However, most investors have chosen to bridge these tokens to the wETH dYdX smart contract.
As of Dec. 1, 438.39 million dYdX tokens, valued at $1.35 billion, are locked in the contract. This bridge operates only one way, so the tokens remain locked in the contract.
Selling pressure rises for dYdX
The recent unlocking has intensified selling pressure on DYDX despite many investors still keeping their tokens bridged in the wETH dYdX smart contract.
Blockchain analyst Lookonchain reported that three whale wallets that received tokens from the dYdX foundation have moved 6.81 million DYDX tokens worth $21.46 million to Binance.
Wallets 0xD21B, 0x63C6, and 0xa70d still collectively hold over 14 million DYDX tokens, indicating the potential for further sales.
Consequently, the token has experienced a nearly 5% decline within the past day and is priced at $3.12 as of press time, according to CryptoSlate’s data.
Other anticipated token unlocks
Meanwhile, other crypto projects, including 1inch, Sui, Optimism, Aptos, and Apecoin, have substantial token unlocks scheduled for this month. Data from Token Unlocks pegged the cumulative value of this planned unlock to $295 million.
Within the next seven days, tokens worth $64.56 million are expected to be unlocked. The primary unlock is 1INCH, releasing $33.96 million, which accounts for 9.5% of its supply. SUI is also slated for an unlock of $21.24 million (3.4% of its supply).
Additional unlocks scheduled for this period include digital assets like Hashflow’s HFT, Galxe’s GAL, Liquity’s LQTY, Euler Finance’s EUL, and Tornado Cash’s TORN.
Mentioned in this article
Posted In: Tokens
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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In this article
DYDX is a governance token that allows the dYdX community to truly govern the dYdX Layer 2 Protocol.
Optimism
$2.33174
Optimism is a layer-2 scaling network for the Ethereum blockchain.
Aptos
$8.89775
Aptos is an FTX-backed layer-1 blockchain which was developed by ex-Meta employees.
Tornado Cash
$2.67070
Tornado Cash is a decentralized, non-custodial privacy solution built on Ethereum.
1inch
$0.43339
1inch is a decentralized exchange (DEX) aggregator that sources liquidity from various exchanges and is capable of splitting a single trade transaction across multiple DEXes.
