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According to data provided by the crypto data source Token Unlocks, Ethereum Layer 2 scaling solution Arbitrum will unlock over $1 billion worth of ARB tokens in March next year. This token unlocking marks the official start of a gradual unlocking process that will continue for four years.
Unlocking 1.11 Billion ARB Tokens
According to Token Unlocks, on March 16, 2024, a total of 1.11 billion ARB tokens, valued at $1.24 billion at the current market price of $1.12, will be unlocked in Arbitrum. This unlocking amount represents 87% of the circulating supply of 1.275 billion ARB tokens. Currently, over 5 billion ARB tokens are locked in Arbitrum.
Unlocking tokens refers to the gradual release of locked coins/tokens into the market to prevent early investors or project team members from selling them in a way that would suppress the price of the altcoin. The preferred method for unlocking tokens in Arbitrum is the Cliff unlocking method, which unlocks a certain number of tokens immediately after a predetermined period, followed by a linear unlocking process.
According to CoinMarketCap data, ARB, the 35th largest altcoin, is currently trading at $1.12, representing a 1.5% decrease in the last 24 hours. The data shows that the leading altcoin has experienced a 4.33% decrease in the past 7 days and a 14.86% decrease in the past 30 days.
Unlocking Millions of ARB Tokens Every 4 Weeks for 4 Years
In a tweet about token unlocking, Token Unlocks also mentioned that after the unlocking process on March 16, 2024, Arbitrum will unlock a certain number of tokens every four weeks for four years.
Unlocking coins/tokens for an altcoin means freeing up liquidity and is considered a catalyst for price decrease. Research conducted by analytics firm The Tie reveals that unlocking events, which represent over 100% of the average daily trading volume, tend to put downward pressure on the price of assets.
