If you start crypto trading, you'll need to seek out news for fundamental analysis (FA) and look for information. During this process, you may often come across news related to crypto token unlocks.
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Token unlocks are often discussed on social platforms like X and Telegram, where it is common to see announcements about which token will unlock how much at what time and how it might affect the market. Myan Crypto page also regularly posts about upcoming token unlocks.
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When token unlocks occur, it is common for the associated cryptocurrencies to experience price drops, often as a preemptive reaction before the actual unlock.

So, what do token unlocks mean?

Many crypto projects tend to set a specific supply limit for their tokens. For example, if ABC token aims for a total supply of 1 billion, they might initially release only around 200 million into the market and then gradually introduce the remaining tokens over time, whether it be monthly or annually, in a controlled manner.
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Some projects also release tokens for team use, advisors, or contributors through token unlocks. This entire process is commonly referred to as vesting, and it is often said that tokens are unlocked when they enter the market.
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When token unlocks happen, they can have a significant impact on the market, generally leading to price declines. This is mainly because new tokens entering the market increase supply, and when these tokens are distributed to teams or contributors, these individuals often sell their tokens for profit, leading to increased supply and sales volume overall.
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Another factor is that early selling can also contribute to price declines. As mentioned earlier, the increased supply and the expectation of selling by those receiving tokens can lead to preemptive selling, especially when there is bad news concerning the economy, politics, military, or the relevant project, which can trigger significant price drops.
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However, such price drops do not occur with every token unlock; they depend on the specific circumstances and timing. Therefore, there is no need to be overly concerned every time a token unlock is imminent.
If a token unlock occurs while prices are rising, even if prices drop, it might only be a small percentage, and you might see a quick recovery afterward.
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For instance, for the TRUMP token, 40 million tokens were unlocked on April 18, 2025. This amount represents 20% of the total supply, yet the TRUMP price fell slightly, and by the 19th, prices had started to recover.
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Another example is Altlayer's ALT. On April 25, 300 million ALT were unlocked, but because the crypto market was already rising, prices surged by 28% within just two days post-unlock. Other examples include PLUME and SCR (Scroll), which also saw token unlocks but experienced moderate price increases similar to TRUMP and ALT.
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Therefore, there is no need to panic every time token unlocks are announced, especially if the overall crypto market is trending upwards, as the likelihood of price increases may outweigh potential declines.
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However, during bearish trends, if the market is weak, it is essential to closely monitor token unlocks. Particularly, if the token you are frequently trading has an upcoming unlock event, you should pay extra attention and prepare in advance.

How can you monitor this?

To monitor token unlocks, you can use websites like CryptoRank, DropsTab, Tokenomist, TokenUnlocks.co, and Bitquery Docs. These websites provide an organized view of token unlock events by date, detailing how much will be unlocked and for what reasons.
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For example, when tokens are unlocked for team use, there is a high likelihood that these tokens will be sold by the team. This is because the funds from the sale of these tokens will be shared among the project's development team.
Therefore, if the supply percentage allocated for the team is significantly high, it is often viewed as negative for long-term prospects.
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If the token unlock is meant to provide returns to large investors, the potential for selling can range from moderate to very high. Investors may choose to hold onto their tokens for long-term gains or may decide to sell immediately for profit.
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On the other hand, if tokens are unlocked for airdrops, there is a strong likelihood of increased selling pressure. Airdrop hunters tend to sell tokens they receive rather than holding onto them, particularly because they often have to complete tasks or missions to qualify for these airdrops, leading to a greater likelihood of selling than buying.
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Examining token unlocks as they approach can be beneficial for futures traders, but for those looking to hold onto a project's token long-term, it is vital to research the project behind the token and understand its tokenomics and vesting schedule.
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Some projects may have adjustments to their vesting schedule due to poor market conditions, issues in development, or partnership problems, and there may be instances of token unlocks being accelerated or delayed, but this generally occurs in a minority of cases.
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In summary, token unlocks are events that can impact the price of the relevant token, so for traders who constantly monitor the market like futures traders, they can create opportunities when they are aware of these unlocks. However, there are also times when unexpected market reactions occur. Therefore, it is essential to keep a close watch on token unlocks and to consider risk management in your trade setups.

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