PANews reported on June 24 that according to Bloomberg, the selling behavior of some early investors and founders seems to be triggering a "cryptocurrency winter" for "Altcoin". CoinMarketCap data shows that since the peak of Bitcoin prices in March this year, the market value of Altcoin(that is, tokens other than Bitcoin, Ethereum or stablecoins) has fallen by nearly 30%, while Bitcoin still accounts for more than 50% of the estimated $2.4 trillion digital asset market. This year, the tokens of many projects began to "unlock", allowing venture capitalists and founders to sell digital assets acquired early. TokenUnlocks data shows that 120 of the 138 tokens tracked have been unlocked this year, with a total market value of approximately $58 billion. This trend contrasts with the rebound in the cryptocurrency market, providing a good opportunity for long-term investors to sell.
Edward Chin, co-founder of Parataxis Capital, pointed out that since the unlocking date is public, non-venture capital holders may sell in advance, exacerbating the price drop. At the same time, the discounted sale of tokens in the over-the-counter market has also exacerbated market pressure. CoinMarketCap data shows that the prices of tokens such as DYDX, AVAX and PYTH have all fallen sharply, with DYDX falling by more than half since mid-March. Tanawat Chiewhawan, CEO of TokenUnlocks, said that although token unlocking boosted prices in 2023, market participants' deepening awareness of unlocking and supply-side data has led to more people pursuing short-term gains rather than long-term holdings. CCData data shows that among the approximately 90 top non-stablecoin assets tracked by centralized exchanges, only 12 assets have recorded positive returns since Bitcoin hit an all-time high on March 14, while 81 assets have recorded negative returns. Bitcoin fell about 12% after reaching nearly $74,000, while 61 of the top 100 tokens fell by more than 25%, and 23 digital assets fell by more than 50%.
Experts point out that Altcoin prices are correlated with the prices of major network tokens such as Ethereum or Solana, and when they fall, smaller Altcoin are usually the first to be sold, and token unlocking further exacerbates the selling pressure. Lex Sokolin, a token economics expert, said that the current market situation is peculiar, and many infrastructure projects funded by investors during the bear market are now about to launch tokens, but these tokens do not have a large number of regular buyers when they are high. "
