HomeNewsAVAX Defies Gravity: 72% Price Surge Amid December Token Unlocks

AVAX Defies Gravity: 72% Price Surge Amid December Token Unlocks

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  • Substantial Gains for AVAX: Despite the release of approximately 3 million tokens in December, Avalanche’s AVAX token has seen a remarkable 72% increase in value since the start of the month.
  • Token Unlocks and Market Impact: The token unlocks, typically considered bearish catalysts due to inflationary pressure, have had minimal impact on AVAX’s market dynamics.

AVAX’s Resilience in the Face of Token Unlocks

In a surprising turn of events in the cryptocurrency market, Avalanche’s AVAX token has demonstrated remarkable resilience. Despite the release of a significant number of tokens into circulation, AVAX has recorded substantial gains, challenging the usual market norms.

Token Unlocks: A Test of Market Strength

Token unlocks, events where previously locked tokens become available, are often scrutinized by experts and traders for their potential inflationary impact on a cryptocurrency’s value. In December, about 3 million AVAX tokens, worth approximately $115 million at the current market price of $38.52, were released, predominantly as staking rewards.

This influx, however, did not exert the expected downward pressure on AVAX’s price. The asset, ranked ninth in market capitalization, instead showed a 7% increase over a 24-hour period according to CoinMarketCap data. The relatively small proportion of these tokens, accounting for just 0.82% of AVAX’s total circulating supply, was likely insufficient to significantly alter market dynamics.

Sustaining Momentum Amidst Market Corrections

AVAX’s performance has been noteworthy, particularly in December. The cryptocurrency has yielded nearly 72% returns on a month-to-date basis, maintaining strong momentum even as the broader market faced sharp corrections.

The next significant token unlock for AVAX is scheduled for February 22, 2024, involving the release of another 9.54 million tokens. Market observers will be keen to see if AVAX can maintain its resilience or experience a price adjustment.

Derivative Market Response to AVAX’s Growth

The positive trend in AVAX’s value has also invigorated its presence in the derivatives market. Open Interest in AVAX futures climbed to an all-time high of $370 million over the past week, as identified by Coinglass data. This surge in interest is indicative of the growing confidence among traders in AVAX’s prospects.

Moreover, the increase in bullish bets and the predominance of traders holding long positions suggest a strong market sentiment in favor of AVAX’s continued growth.

In conclusion, AVAX’s ability to thrive amidst token unlocks and market fluctuations underscores its robustness as a digital asset. Its performance, defying typical market expectations, highlights the unique dynamics at play in the cryptocurrency world, where traditional predictors may not always apply. As AVAX continues its upward trajectory, it stands as a testament to the unpredictable and dynamic nature of the crypto market.

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AnnJoy Makena
AnnJoy Makenahttps://www.ethnews.com
Annjoy Makena is an accomplished and passionate writer who specializes in the fascinating world of cryptocurrencies. With a profound understanding of blockchain technology and its implications, she is dedicated to demystifying complex concepts and delivering valuable insights to her readers. Business Email: info@ethnews.com Phone: +49 160 92211628