AVAX Token Unlock Might Bring Volatility This Week! Be Careful, Traders

Avalanche (AVAX), the layer-1 blockchain known for its scalability and speed, is among several high-profile cryptocurrencies facing token unlock events this week. According to a recent report from Wu Blockchain, the combined value of tokens being unlocked across major altcoins—including AVAX, Solana (SOL), Optimism (OP), and Dogecoin (DOGE)—is projected to exceed $625 million. 

These token unlocks may introduce increased market volatility, making it a critical period for traders to monitor.

Also read:

AvaCloud Partners with Avalanche to Host Developer Competition: $10,000 in Prizes Up for Grabs

What Is a Token Unlock and Why It Matters

Token unlocks refer to the scheduled release of previously restricted tokens into the circulating supply. These events are typically part of a project’s vesting schedule for investors, developers, or community contributors. There are two primary types:

• Cliff unlocks: Tokens are released all at once after a certain lockup period.
  
   
• Linear unlocks: Tokens are distributed gradually over time.
  
   

For Avalanche, the upcoming unlock is of the linear type, with over $1 million worth of AVAX expected to enter circulation daily this week. This gradual release may soften the market impact somewhat, but caution remains warranted.

Why AVAX Traders Should Watch Closely

As of April 30, 2025, AVAX is trading around $21.65 with a circulating supply of over 416 million tokens, according to CoinGecko. When a significant number of tokens are added to this supply—especially if the amount surpasses 1% of the current circulating supply—it can cause selling pressure and a potential dip in price.

While Avalanche’s unlock may not breach the 1% threshold, its inclusion in the list of projects with daily unlock volumes exceeding $1 million is enough to raise red flags for short-term traders.

Historical market behavior has shown that token unlocks often trigger bearish sentiment, as early investors or contributors may choose to sell their unlocked tokens to secure profits, especially during uncertain market conditions.

Also read:

How to Buy Avalanche (AVAX)

Other Projects Facing Token Unlock Events

Alongside AVAX, other major projects undergoing unlocks include:

• Sui (SUI)
  
   
• Optimism (OP)
  
   
• Solana (SOL)
  
   
• Dogecoin (DOGE)
  
   
• NEAR Protocol (NEAR)
  
   
• Celestia (TIA)
  
   
• Polkadot (DOT)
  
   

Some of these projects, such as OMNI, KMNO, REZ, and GUNZ, are unlocking more than 10% of their circulating supply—a level that typically leads to dramatic price action.

In contrast, AVAX’s unlock is relatively modest, but traders should still exercise caution due to broader market reactions.

Also read:

Can AVAX Go Back to Its Previous ATH? Looking at the Current Data

Will Avalanche Withstand the Pressure?

Avalanche’s technical fundamentals remain strong. It’s one of the fastest-growing smart contract platforms, with robust developer activity and ongoing partnerships, such as the recent collaboration with AvaCloud to promote eERC20 tokens. These fundamentals might help mitigate potential negative effects from the unlock.

Additionally, seasoned investors may have already priced in the unlock event, reducing its shock value. Still, short-term traders should prepare for potential volatility by closely tracking AVAX's price movements and order books on major exchanges.

Conclusion

Token unlock events are critical calendar dates in the crypto market. They can significantly influence asset prices, particularly when investor psychology turns risk-averse. Avalanche’s unlock this week is not necessarily catastrophic, but traders should be vigilant. 

Whether you’re long-term bullish or trading on short timeframes, understanding the implications of token supply shifts can offer a strategic edge.

Also read:

AVAX Price Prediction 2025: Will Price Go Up By More Than 100% This Year?

FAQs

1. What is the purpose of token unlocks in crypto projects?

Token unlocks release previously vested tokens into circulation, often to reward early investors, developers, or communities.

2. How much AVAX is being unlocked this week?

Over $1 million worth of AVAX will be unlocked daily as part of a linear release schedule.

3. Will the AVAX token unlock crash the price?

Not necessarily. Although unlocks can cause downward pressure, the effect may be limited if the market has already priced it in.

4. Should I sell my AVAX before the unlock?

That depends on your strategy. Long-term holders may choose to hold through volatility, while short-term traders might reduce exposure.

Bitrue Official Website:

Website:

https://www.bitrue.com/

Sign Up:

https://www.bitrue.com/user/register

Disclaimer: The views expressed belong exclusively to the author and do not reflect the views of this platform. This platform and its affiliates disclaim any responsibility for the accuracy or suitability of the information provided. It is for informational purposes only and not intended as financial or investment advice.