Token Unlocks: Three Cryptocurrencies to Avoid Trading Next Week

Cryptocurrency traders and investors should beware of three tokens scheduled for unlocking next week, potentially impacting their trading value. These tokens include DYDX Protocol's DYDX, Sui Network's SUI, and Echelon Prime's PRIME, with a combined unlock value of $232 million out of $270.58 million. DYDX will unlock $117.33 million worth of tokens, SUI will release $76.07 million, and PRIME will unlock $38.58 million. Traders should consider these unlocks and their potential effects on price and volatility to manage risks and make informed trading decisions.

Circulating Supply Inflation: A Critical Consideration in Cryptocurrency Trading

The circulating supply of a cryptocurrency, which represents the total number of coins currently in circulation, is a fundamental economic factor that can significantly impact its price. When new coins are issued or previously locked coins are unlocked, it increases the supply, potentially affecting the trading value.

Savvy cryptocurrency traders and investors closely monitor supply and demand dynamics to make informed decisions and manage their risk exposure. In light of this, it is crucial to identify cryptocurrencies with scheduled token unlocks, as these events can trigger significant sell-off volatility.

Cryptocurrencies to Avoid Trading Next Week Due to Token Unlocks

Through extensive analysis, three cryptocurrencies have been identified that are scheduled to unlock a substantial number of tokens next week, representing a combined value of $232 million out of a total $270.58 million worth of tokens. These cryptocurrencies include:

DYdX Protocol (DYDX)

The decentralized exchange protocol DYDX is releasing 33.34 million DYDX tokens on March 31, currently valued at approximately $117.33 million. This represents a 10% loss in the month-over-month price of the DeFi cryptocurrency. Notably, early investors will receive the most significant portion of the tokens, with a value of $65.07 million, while the team will receive $35.83 million worth of DYDX.

Sui Network (SUI)

Sui Network is unlocking 4 million SUI tokens to the community reserve on March 30, with a value of $7.88 million. However, TokenUnlocks.App indicates a total unlock of $76.07 million worth of tokens, with the distribution not yet fully disclosed.

Echelon Prime (PRIME)

Echelon Prime will unlock 1.66 million PRIME tokens on March 30, valued at approximately $38.58 million. The distribution includes 912,040 PRIME to the Parallel Studios reserve and 750,000 to private investors.

Market Impact and Risk Management

It is important to note that increasing a token's supply does not always result in a decline in its price. If the asset experiences an increased demand, its value could still rise even with a higher supply. However, traders often speculate on the economic implications of token unlocks, which can lead to increased volatility and a potential worsening of the risk-reward ratio.

Hence, it is essential to exercise due diligence and avoid trading these particular cryptocurrencies during the specified period due to the anticipated sell-off volatility. The cryptocurrency market remains highly uncertain and influenced by various factors, making it imperative to implement sound risk management strategies and identify opportune moments to abstain from specific cryptocurrency trades.

Disclaimer

The information provided in this article is for informational purposes only and should not be construed as investment advice. Investing in cryptocurrencies involves significant risk, and it is crucial to conduct thorough research and consult with financial professionals before making any investment decisions.