Several tokens including S, MOVE, BB, APT, IO and PEAQ are scheduled for significant unlocks this week, potentially impacting market prices.

Executive Summary

This week, several tokens including S, MOVE, BB, APT, IO and PEAQ will undergo significant token unlocks. These unlocks, where previously restricted tokens become available in the market, may lead to increased selling pressure and price declines, depending on distribution strategies and overall market sentiment. The unlocks are scheduled throughout the week, with Sonic (S), Movement (MOVE), and Aptos (APT) representing a substantial portion of the unlocked value.

The Event in Detail

On September 9th, Movement (MOVE) unlocked approximately 50 million tokens at 11:00 AM (GMT+8), representing 1.89% of the circulating supply, valued at approximately $5.94 million. Separately, Sonic (S) will unlock approximately 150 million tokens, representing 5.02% of the current circulating supply, valued at approximately $45.68 million. Aptos (APT) will unlock approximately 11.31 million tokens on September 11, representing 2.20% of the circulating supply, valued at approximately $48.18 million. In addition, io.net (IO), BounceBit (BB) and Peaq (PEAQ) are also scheduled for unlocks.

Market Implications

Token unlocks are critical events that often trigger price volatility due to the increased circulating supply. If demand does not match the increased supply, prices may come under pressure. Investor psychology plays a significant role, as early investors or project teams may sell unlocked tokens for profit. Smaller tokens with low liquidity are generally more sensitive to unlocks. September is projected to see approximately $4.5 billion in vested tokens unlocked. Cliff unlocks, which are larger, one-time releases, account for $1.17 billion of this total, while linear unlocks account for $3.36 billion.

Expert Commentary

According to Binance research, > Token unlocks are pivotal events in the crypto market, often triggering significant price volatility. These events affect the market due to increased circulating supply, as unlocks boost the number of tradable tokens, potentially pressuring prices if demand doesn't match.

Syed Fahad Hussain notes that > Unlock cliffs often cause volatility — plan accordingly.

Broader Context

Projects must consider tokenomics, which encompasses the financial architecture underpinning a protocol's sustainability, governance, and long-term value. Elements of tokenomics include total and max supply, initial allocation, vesting and lockups, burn mechanisms and emission schedule. Supply pressure caused by token unlocks can be mitigated using strategies such as lock staking incentives or building liquidity buffers. Projects with a high percentage of circulating tokens tend to be less volatile during unlocks, as the impact of new tokens entering the market is minimized. Projects should stress-test their tokenomic models to model best-case, base-case, and worst-case outcomes.