Avalanche, the blockchain platform ready for a major event in the month of love, is gearing up for a major development. As February unfolds, the cryptocurrency market anticipates the release of nearly $900 million in acquired tokens from a wide range of projects. This impending influx into the market has led to a wave of concerns among investors who are closely watching the unfolding scenario.
Projects involved in this token release include Avalanche (AVAX), Aptos (APT), The Sandbox (SAND), Optimism (OP) and SUI. Avalanche strategically targets strategic partners, team members, and an airdrop to maintain a balance between long-term engagement and potential short-term sell-out.
Avalanche bails for major token release
Avalanche is scheduled for release on February 22 and will release 9.5 million tokens worth approximately $320 million. Similarly, Aptos is gearing up to release 24.8 million tokens worth approximately $233 million on February 11. The distribution strategy for Aptos aims to ensure market stability while promoting community involvement.
The impending release of these acquired tokens has put the crypto community on high alert. Investors and analysts are watching developments closely with a mix of excitement and caution. While there is anticipation for the release of tokens, there is also a sense of vigilance as market participants evaluate how the increase in supply could impact project valuations and overall stability.
Avalanche currently trading at $35.76 on the daily chart: TradingView.com
Navigating a Potential Correction Phase: AVAX Price Analysis
Avalanche (AVAX) has recently captured the market’s attention with impressive price performance, surging a remarkable 470% after breaking the bear market’s downtrend line on November 1.
Recent analysis suggests that AVAX is currently facing resistance on a descending trendline from the December high, which could lead to a price rejection and subsequent decline.
If this correction signals the start of a lasting bull phase for Avalanche, support levels around $20, in line with the 0.5 to 0.618 Fibonacci retracement levels, could come into play. After this correction phase, AVAX could potentially start a new uptrend, surpassing its all-time high.
Image source: DefiLlama
Meanwhile, AVAX has grown exponentially over the past year and is now the sixth largest DeFi chain, according to DeFiLlama data. An artificial intelligence (AI)-based price prediction model has predicted that the price of the AVAX token would increase by more than 500% from current levels, reaching over 500%. $200 by early 2025.
Previous AVAX Unlock and Its Impact on the Market
It is crucial to note that AVAX’s previous token unlock on November 23 did not cause any significant price fluctuations. However, leading up to the unlock, the price experienced a 16% drop from nearly $23 on November 20 to $19 upon the tokens’ release.
This historical precedent underlines the importance of closely monitoring market dynamics during token release events. Market participants should exercise caution and carefully consider the potential impact of these developments on their investment strategies.
Featured image from Adobe Stock, chart from TradingView
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