The price of Avalanche’s AVAX token has dipped by 11% in the past week, bucking the bullish trend in the broader cryptocurrency market. This comes amidst a $365 million unlocking event that increased the token’s circulating supply by 2.6%. Experts suggest both short-term challenges and long-term opportunities for AVAX.
Unlocking Event Triggers AVAX Price Dip
Source:Token.Unlocks data indicates that on Thursday, locked-up tokens valued at approximately $303 million will be released from vesting and put into circulation.
AVAX price in the red. Source: Coingecko
Analyst Opinions Diverge
Despite the recent dip, some analysts remain optimistic about AVAX’s future. The Tie’s report, while acknowledging the short-term price pressure, highlights the Avalanche network’s growing activity, fueled by popular NFT collections like Dreamheadz and Dokyoworld. The increased engagement within the NFT space is seen as a positive indicator for long-term adoption and potential price appreciation.TSM’s Subnet launched, where all premium subscriptions on the platform now flow on-chain, with more features to come later in Q1 — Avalanche 🔺 (@avax)Furthermore, analysts point to AVAX’s outperformance compared to specific peers like Celestia and Solana in recent days. This suggests some resilience in the face of the unlocking event and potential buying pressure despite the overall price dip. Some analysts even predict a possible climb to the $40 mark by the end of February, although this remains speculative.
Avalanche (AVAX) is currently trading at $36.95. Chart:
Market Sentiment And Broader Trends
It’s important to remember that the cryptocurrency market is inherently volatile, and AVAX’s price will be influenced by various factors beyond the unlocking event.AVAX price retreating today. Source: CoingeckoThe recent unlocking event has undoubtedly impacted AVAX’s price in the short term. However, analysts remain divided on the token’s future trajectory. While some anticipate further price declines due to the increased supply, others highlight positive developments like the network’s growing NFT activity and potential for a rebound.
Featured image from Pixabay, chart from TradingView