By
Kseniia Klichova
April 23rd, 2024
In addition to Arbitrum, a number of other projects are gearing up to unlock tokens this week. Axie Infinity, for instance, is set to release around 10.87 million AXS tokens on April 16.
Arbitrum, a major layer-2 blockchain system, is getting ready for another big event on April 16, 2024, dubbed “Cliff Unlock.” According to Token Unlocks, Arbitrum will unlock around 92.65 million ARB tokens, which is about 3.49 percent of the total number of tokens in circulation. At the time of writing, this huge sum is worth approximately $116.73 million on the market.
This event has been labeled as a “Cliff Unlock”, which means that no tokens will be released until the specified date, also called the “cliff” or unlock date. A huge number of tokens will be released to the market all at once on this date.
Arbitrum unlock progress and countdown to next unlock. Photo: Token Unlocks
Effects of the ‘Cliff Unlock’
These kinds of events can have a big effect on the market, often making it more volatile and full of trading activity. Traders often speculate how prices will move around these events with the goal to make money from possible price changes. In the case of ARB, the market response to the previous Token Unlock was big. The price of the token dipped considerably, but then it soared again.
The crypto community is looking forward to the “Cliff Unlock” and making predictions about what it will mean. Traders and buyers are paying close attention to how the market is moving because the sudden influx of ARB tokens could cause big price changes. The community is split; some people think prices will go up after the unlock, while others remain cautious given the likelihood of higher volatility.
Lessons from Previous Arbitrum ARB Unlocks
Arbitrum’s previous Token Unlock event, during which 1.11 billion ARB tokens were released, teaches us a lot regarding how the market might respond. Soon after the open, the price of the token dropped sharply, but it quickly rose again. Based on this trend, the unlock event may cause short-term price changes, but it’s not clear what will happen to the token’s value in the long term.
ARB’s price dropped for four days in a row after the last Token Unlock event, losing more than 25% of its value. TradingView shows that the asset linked to Arbitrum’s layer-2 blockchain dropped from $1.96 on March 16 to $1.44 by March 19.
In addition to Arbitrum, a number of other projects are gearing up to unlock tokens this week. Axie Infinity, for instance, is set to release around 10.87 million AXS tokens on April 16. This release represents about 7.6% of the project’s circulating supply, with a total value of approximately $1.055 billion. Additionally, Immutable X is set to release 34.19 IMX worth $76.59 million into the market this week, accounting for 2.4% of the circulating supply.
These tokens were originally allocated for various purposes, including the project’s foundation, community, core contributors, and investors.