Avalanche [AVAX] jumps 7% ahead of token unlock: Is $43.50 coming?

AVAX

As a researcher with experience in cryptocurrency markets and token economics, I find AVAX‘s current situation intriguing. The upcoming token unlock might not lead to significant volatility due to the project having already released 60% of its supply. The price increase we are seeing could be driven by improving sentiment and social dominance, as indicated by on-chain data.

In the past 24 hours, the cost of Avalanche [AVAX] has risen by 7.80%. Currently, a token is being traded for approximately $37.48 based on information from CoinMarketCap.

Surprisingly, this was happening less than four days before the next token unlock of the project.

Based on information from the Token Unlocks platform, approximately 2.49% of AVAX‘s entire issuance will become accessible on May 22nd.

As a researcher studying the Avax token economy, I can tell you that this ratio corresponds to approximately 9.54 million tokens, equivalent to around $329 million in value. Upon implementation, it signifies that roughly two-thirds (62.49%) of the entire Avax supply will be accessible in circulation.

AVAX gets a big share of the pie

Unlocking tokens can be less than ideal given their inherent risk. The larger the unlock, the more pronounced the potential price drops.

Projects that have committed around 60-70% of their supply tend to exhibit lower price volatility.

In certain situations, AVAX may cost more upfront, particularly during the initial phases of its unlocking process. It’s intriguing that this trend appears to hold true for AVAX.

As a crypto investor, I believe in thoroughly analyzing a token’s on-chain activities to assess its potential. One significant observation I made using AMBCrypto was the increasing Weighted Sentiment surrounding the token.

As of this writing, the Weighted Sentiment around the Avalanche project was -0.036.

Despite the unfavorable result, there was a significant improvement from a reading of -0.574 on May 15th, implying that the participants had begun to relinquish their pessimistic outlook.

The Social Dominance score, reflecting the positivity of discussions around the project, had risen to 1.046% as of the latest update.

No stopping the price increase?

In simpler terms, a pessimistic outlook and greater influence in social circles could potentially boost the value.

The value of AVAX might reach as high as $43.50 in a bullish scenario within the immediate future, while a more conservative estimation places it at around $40.

Traders should exercise caution if they notice social dominance becoming excessively pronounced. This heightened sense of social influence might be indicative of FOMO, or the fear of missing out on potential profits.

Three days ago, the metric for AVAX surpassed its predicted value, resulting in a significant drop in price from $35.08 to $31.42.

If the feeling shifts toward positivity, then the bullish perspective may hold true.

As a crypto investor, I’ve noticed an uptick in the price of AVAX, and interestingly enough, this trend is being supported by substantial trading volume. According to Santiment’s latest on-chain data, at the present moment, AVAX boasts a trading volume of approximately $534.57 million – the largest we’ve seen over the past week.

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If the volume keeps growing as the price goes up, we might see a significant jump to $50 in the near future.

If the quantity being sold is increasing while the price is decreasing, or if the price is rising but the quantity is decreasing, it’s a sign that demand may be weakening. This could potentially undermine any optimistic outlook for the market.

2024-05-18 17:11

AVAX gets a big share of the pie

No stopping the price increase?

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