Arsablog

Release of 150 million DYDX token units; Will the price fall?

crypto-analysts-warn-against-shorting-dydx-ahead-of-200m-token-unlock

150 million DYDX tokens with a current value of $250 million will be released on February 2. This number is almost equivalent to the current total market value of this project and has caused a lot of concern about the price drop among the holders of this token.

According to Mihan Blockchain and quoted by CoinDesk, the dydx decentralized trading platform has been operating since 2021 and has been welcomed by users. According to the Tokenomix program, a phase of the DYDX token cliff period will end on February 2 (Bahman 13) and 15% of the total tokens of this project, equivalent to 150 million units, will be available to the initial investors of the project. At the current price, DYDX will be worth something close to 250 million dollars.

It should be noted that the total number of DYDX tokens is equal to 1 billion units, of which 156 million units are currently in circulation. it means that On the 13th of Bahman, almost close to the current market cap of the project, the token will be available to investors, and the possibility of selling all or part of this amount by them may cause sales pressure and a drop in the price of DYDX.. All 1 billion token units of this project are supposed to be released and circulated by 2026.

Charles Storry, the development manager of Phuture, believes that due to this, many traders will take short positions. But at the same time, Storey believes that current DYDX holders have preferred not to sell their holdings even at this time, which can be seen by the support provided by buyers around the $1 price in late December. The price of DYDX has grown by about 70% since then and in less than 1 month.

The figure below shows the daily price chart of DYDX, the price has been supported 3 times by the $1 area, and if it crosses the price of $2.77, it can be said that the bullish head and shoulder pattern has been completed and we should wait for a sharp jump in the price. Currently, $1.66 is an important level above which the price should consolidate, but if it is lost, the next support will be $1.41.

dydx price chart daily time frame Source: Tradingview
dydx price chart daily time frame Source: Tradingview

What plan does the dydx team have to prevent the price drop?

In the world of cryptocurrencies, events such as the release of tokens are usually planned in advance by the project team in order to prevent a sharp price drop by creating fundamental and positive development news. There are currently 3 definitive development plans for dydx in 2023, but no exact release date has been announced yet. Of course, this may be intentional to give a positive shock to the market by unveiling them on the eve of 13th of Bahman. These 3 programs are:

  • Release of the fourth version of the dydx trading platform on Cosmos hub. According to the project team, in this version, we will see free transaction fees for users.
  • Release of Android version of dydx application
  • Add option trading section to this platform

Will the release of DYDX tokens cause its price to fall?

  • Due to the high volume of released tokens, on paper we should see a decrease in the price of DYDX. But there are 2 issues that may reduce the impact of this event on the price: 1- The development plans of the project team 2- The support of the current holders of this token for the price that can be seen in its chart.

source

Leave a Reply

Your email address will not be published.