Some 10 million of Axie’s AXS tokens owned by insiders and early investors will be unlocked soon, creating selling pressure. AXS price has dropped following prior unlocking.
As $215 million worth of the project's AXS tokens are unlocked in the coming days, Axie Infinity, one of the first computer games focused on cryptocurrencies, may see intense selling pressure.
Players accumulate in-game currency and non-fungible tokens in Axie, which they can use to level up their characters or sell.
TokenUnlocks, a data website, estimates that 21.5 million tokens, or nearly 8% of the total supply, will become available on October 24 when the vesting period ends. The unlock timeline is dependent on transaction block numbers, which Chief Operating Officer of Axie creator Sky Mavis Aleksander Larsen predicted would occur on October 26.
According to TokenUnlock, the remaining half, or about 11 million tokens, are set aside for staking incentives, play-to-earn rewards, and ecosystem money in the future. According to Larsen, these tokens won't be put into circulation right away.
According to Larsen of CoinDesk, Sky Mavis, the blockchain gaming studio that created Axie, "just staked 11 million AXS and will stake our forthcoming token unlock as well."
As a result of earlier unlocking dates, the AXS price has decreased, blockchain investigator Lookonchain noted in a tweet.
According to the project's white paper, Axie Infinity sold 10.5 million tokens to raise $864,000 in a private token sale in the middle of 2020. According to the calculations, each token costs 8 cents on average. Those who made investments in the private offering are allegedly sitting on substantial paper profits as AXS was trading at about $10 at the time of writing.
"Investors in the private auction are still profiting 125 times, even if they sell AXS at $10. Therefore, selling after unlocking is quite likely to occur, according to Lookonchain.
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