This week, Liquid staking protocol Lido (LDO), the Avalanche Blockchain native token (AVAX) and the token behind the Yield Guild Games DAO (YGG) are all set to implement token unlocks. Token unlocks are a way of releasing coins that were previously frozen to prevent early investors or project team members from liquidating their holdings in large numbers.
On Aug. 26, 8.5 million LDO tokens, valued at $14.2 million, will be distributed to investors who already hold more than 300 million tokens, according to TokenUnlocks. This equates to roughly 0.97% of the total supply. LDO’s token has declined 8.5% during the last week, and has been relatively stable in the last 24 hours, according to market data.
The same day, 9.54 million AVAX tokens worth $102.86 million, amounting to 2.77% of the total circulating supply, will be released. This will be split between the strategic partners, who get 2.25 million, or $24.21 million worth, the Foundation, which gets 1.67 million tokens, the team, which is allocated 4.5 million tokens, or $48.42 million, and airdrop participants who get 1.13 million tokens. AVAX is down 13% during the last week, according to CoinDesk market data, and is down 1.8% on-day.
On Sunday, Aug. 26, 12.2 million YGG ($2.87 million) will be released, totaling 6.6% of the cryptocurrency’s circulating supply. YGG’s token is down nearly 59% in the last year, despite a rally in the last month which temporarily brought it up 49%. During the last week it lost an additional 30% of its value, and is down 2% on-day.
Analytics firm The Tie studied over 350,000 unlock events and found that on average, coins declined in the lead-up to the event. However, when the liquidity freed up amounted to more than 100% of the average daily volume, prices quickly rebounded before falling again within two weeks. Lindsey Winder, CEO of token infrastructure firm Hedgey Finance, said to CoinDesk in May, “Token unlocks freak people out in general, but the upcoming Avalanche unlock has been mapped out for a while now and most sophisticated actors have adjusted for it.”