Major Altcoin Token Unlocks Set To Shake Crypto This Week

Seven altcoins will see over $2.6billion worth of tokens unlocked this week. ONDO alone accounts for $2.42bn, surpassing its circulating supply by 130%. The large unlocks are driving significant price declines for affected tokens, as Arbitrum, Ethena, and Starknet dropped by nearly 10% drop today.

The crypto market may experience heightened volatility this week as major token unlocks are set to release billions of dollars worth of coins. Ondo Finance’s ONDO token stands out as the largest contributor to the influx. Arbitrum and Starknet will also see over 2% of its circulating supply unlocked by 19 January.

Weekly altcoin token unlock schedule

Total emissions: $2.60bn+

• ONDO (134.21%) – $2.42bn
• ARB (2.20%) – $69.32m
• STRK (2.65%) – $27.55m
• SEI (1.32%) – $21.06m
• APE (2.16%) – $17.32m
• ENA (0.42%) – $11.98m
• PRIME (1.42%) – $10.07m
  (Percentage of circulating supply)

What are altcoin token unlocks?

Altcoin token unlocks refer to the release of previously restricted tokens into circulation. These tokens are often held in lock-up periods to prevent early investors, project teams, or other stakeholders from immediately selling large amounts of the cryptocurrency, which could destabilize the market.

Token unlocks are part of a cryptocurrency’s distribution schedule. They aim to:

1. Reward early stakeholders: Investors and team members receive tokens as part of their initial agreements.
2. Support project development: Funds from unlocks can be used for marketing, partnerships, or technical development.
3. Promote liquidity: Gradual release ensures tokens are available for trading and ecosystem growth without overwhelming the market.

Largest token unlock since November

Data from Tokenomist shows this week’s token unlocks a total of $3bn, marking the largest weekly figure in over two months. Ondo Finance’s ONDO token dominates the list with an upcoming release of 1.94 billion tokens valued at $2.23bn. This figure represents over 130% of ONDO’s current circulating supply, which stands at approximately 1.4 billion tokens.

ONDO’s scheduled unlock on 18 January far exceeds its recent daily trading volume of $250–$300m, raising concerns about potential market volatility.

Why are prices dropping this week?

In addition to ONDO, the other six altcoins have also dropped significantly today ahead of the token unlock. Arbitrum lost nearly 9% today and over 25% in the past week. Ethena (ENA) saw a massive 13% plunge on the day, while Starknet lost 10%. The impact has extended across the entire altcoin market, as Bitcoin’s dominance increased to 58%. This could further delay the anticipation of an altcoin season in the first half of 2025.

These significant price drops ahead of the token unlocks can be attributed to the following reasons:

1. Increased supply: Large-scale token releases boost supply, which can reduce the token’s value if demand remains unchanged.
2. Investor concerns: The market often anticipates sell-offs from early holders looking to liquidate their unlocked tokens. This creates downward pressure on prices.
3. Market sentiment: Negative sentiment surrounding the unlocks may lead traders to exit positions in anticipation of further declines.

Biggest token unlock for ONDO

Token unlocks aim to minimize sudden price movements and maintain market stability. However, ONDO’s release poses an exception due to its significant size relative to both circulating supply and daily trading volume.

According to research, tokens with unlock events exceeding 100% of average daily trading volumes often experience significant price fluctuations before and after the release.

ONDO traded at $1.19 at the time of writing, marking its lowest price since December 2. The token has dropped 5% for the day and 15% for the month so far, based on data from TradingView. Prices have continued to slide since reaching a record high of $2.10 on 16 December.

The market will closely monitor ONDO’s unlock event this week, which could set the tone for altcoin volatility in the days ahead.