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Avalanche (AVAX), one of the layer-2 blockchain platforms competing with Ethereum, is experiencing a price drop amid a rise in the crypto market. This is due to the token unlocking event or the release of locked AVAX tokens worth $ 365 million (Rp 5.7 trillion) this week.
In the past week, the price of AVAX fell 3.2%, to $38 (USD 593 thousand) per token, according to data from CoinGecko. Meanwhile, most other cryptocurrencies saw their prices rise. The CoinDesk Market Index (CMI), which includes 173 crypto assets, rose 5.8% over the same period. The CoinDesk20 Index (CD20), which tracks the performance of the 20 largest and most liquid crypto assets, rose 6.4%.
The decline in AVAX price occurs ahead of the token unlock event which will take place on Thursday, February 22, 2024. According to data from Token.Unlocks, approximately 9.5 million previously locked AVAX tokens will be released to the market, increasing the circulating supply of the asset by about 2.6%. The tokens will be allocated to team members, strategic partners, ecosystem development foundations, and airdrop recipients. Currently, about 58% of AVAX's total supply, which amounts to 1 billion tokens, is still locked.
What is Avalanche Unlock Token?
Token unlock is an event where a certain number of previously locked tokens become available for sale and sale. In the case of Avalanche, unlock tokens occur periodically and are distributed to various parties, including the development team, investors, and AVAX holders.
Token unlock is a process where tokens that were previously locked for a specific reason, such as vesting, lock-up, or staking periods, are freed up and tradable on the market. Unlocking tokens can have a negative impact on asset prices, as it increases the available supply and lowers relative demand. A study by crypto analytics firm The Tie last year found that large unlocking events typically lead to an average price drop of 8.8% in two weeks.
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Impact of Avalanche Unlock Token on AVAX Price
Token unlock can have a negative impact on the price of AVAX as it increases the number of tokens circulating in the market. This can lead to selling pressure, as investors who receive unlock tokens may want to sell them for a profit.
On February 20, 2024, Avalanche experienced $365 million worth of unlock tokens. This led to a 5% drop in the price of AVAX, despite the overall crypto market being on the rise.
AVAX Price Movement
Based on today's Bittime market, the price of AVAX was observed to have increased 0.32 percent in the last 24 hours. Currently the price of AVAX to IDR is IDR 588,168.
Get to know Avalanche, Ethereum's Competitor Blockchain
Avalanche is a layer-2 blockchain platform that offers scalability solutions for Ethereum, the largest and most popular blockchain network today. Avalanche claims to be able to process over 4,500 transactions per second with very low gas fees, compared to Ethereum which can only process around 15 transactions per second with high gas fees.
Avalanche uses a technology called Snow, which is a family of consensus protocols based on sampling methods. Snow allows every node on the network to verify transactions quickly and efficiently, without the need to reach consensus with the entire network. Snow also enables the Avalanche network to support a wide variety of applications, including smart contracts, tokens, and NFTs.
Avalanche consists of three main networks, namely Platform Chain (P-Chain), Contract Chain (C-Chain), and Exchange Chain (X-Chain). P-Chain is a network that governs validators and subnets, that is, a collection of validators that work together to validate transactions on the Avalanche network.
C-Chain is a network that supports smart contracts and is compatible with the Ethereum Virtual Machine (EVM), allowing developers to move their applications from Ethereum to Avalanche easily. X-Chain is a network that supports the creation and exchange of tokens and NFTs.
In addition to these three main networks, Avalanche also supports creating custom networks called Dynamic Subnets. Dynamic Subnets are networks that can be tailored to user needs, such as speed, security, or privacy. Dynamic Subnets can interact with Avalanche's main network as well as with other networks, such as Ethereum or Bitcoin, through the cross-chain feature.
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Conclusion
Avalanche launched in September 2020, after raising $42 million (IDR 655 billion) in a public token sale that ran out within 4.5 hours. Previously, Avalanche also raised $12 million (IDR 187 billion) in a private token sale involving well-known investors, such as Galaxy Digital, Bitmain, Initialized Capital, and Dragonfly Capital.
Avalanche has a native token called AVAX, which is used to pay gas fees, stake, and participate in network governance. The AVAX token has a total supply of 1 billion tokens, with 366.8 million tokens in circulation in the market today. AVAX tokens are traded on various crypto exchanges, such as Binance and Bittime.
With the unlocking event taking place this week, AVAX price has the potential to experience selling pressure. However, this can also be an opportunity for investors who want to buy AVAX tokens at low prices. With the vision and technology possessed by Avalanche, the AVAX token can have bright prospects in the future.
How to Buy Avalanche (AVAX) on Bittime
You can buy and sell Avalanche (AVAX) in an easy and secure way through Bittime. Bittime is one of the best crypto applications in Indonesia that has been officially registered by Bappebti.
Avalanche (AVAX) is available on Bittime with the market pair AVAX/IDR. To be able to buy AVAX IDR on Bittime, make sure you have registered and completed identity verification. In addition, also make sure that you have enough balance by depositing some funds into the wallet. For your information, the minimum asset purchase at Bittime is Rp10,000. After that, then you can make a crypto asset purchase in the application.
Learn the complete guide on how to buy Avalanche (AVAX) on Bittime.
Monitor the price chart movements of Avalanche (AVAX), Bitcoin (BTC), Ethereum (ETH), Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.
Also Read:
What is Avalanche? How to Connect to MetaMask?
Uncovering the Potential of AVAX and the Growing Avalanche Ecosystem
Avalanche (AVAX) Comprehensive Review 2024: A Complete Guide
DISCLAIMER: This article is informational in nature and does not constitute an offer or solicitation to sell and buy any crypto asset. Trading crypto assets is a high-risk activity. The price of crypto assets is volatile, where prices can change significantly from time to time and Bittime is not responsible for fluctuations in the exchange rate of crypto assets.
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