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AXS Gaming Token Sees 40% Rise Ahead Of Token Unlock Worth $64M

Axie Infinity stands as a giant within the Play-to-Earn space, and its namesake cryptocurrency, AXS, is performing something interesting. The cryptocurrency has recently unlocked millions of USD in tokens. The typical mentality such an increase in supply brings is typically bearish. Not only did the cryptocurrency increase in value, but it also didn’t crash through the floor after either.

Bullish Sentiments Ahead Of Liquidity Increase

Within the past 24 hours, the cryptocurrency saw a spectacular value increase of 40%. The coin reached a high of $13.68 before being corrected after the AXS tokens were unlocked. At the time of writing, the cryptocurrency is changing hands at around $12, according to CoinMarketCap.

As one would imagine, this increase in price directly led to an increase in the value of a number of open contracts in perpetual futures. These contracts saw a spectacular increase of 156%, reaching a value of $104 million. With this big price rally and a general increase in open interest, it’s easy to see why the outlook for the cryptocurrency is bullish indeed.

A Positive Reaction To Massive Unlock

Axie Infinity stands as a blockchain-based battling and trading game. It allows its players to collect “Axies,” breeding, battling, raising, and trading these creatures. These Axies are represented on the blockchain via non-fungible tokens, or NFTs. The game utilizes a governance token, as well. This token goes by the name Axie Infinity Shards (AXS)

The seemingly confusing aspect of all of this, however, is focused on the fact that it was a bullish market, in the first place. As one would imagine, unlocks are considered bearish, as it allows investors to cash in profits while increasing the liquidity. Typically, the whales of that specific cryptocurrency see their wallets temporarily frozen in order to stop them from enacting a price dump by selling everything they have at once.

Training The Market

Felix Hartmann stands as a managing partner at Hartmann Capital, a crypto investment firm. Hartmann gave his opinion, and revealed that previous market practices could be why the cryptocurrency didn’t flop. Simply put, investors are looking forward to a positive announcement just after the tokens are unlocked.

Hartmann explained that in the previous 12 months, a new practice had started where crypto teams would make a very bullish announcement after a large token unlock. The fact of the matter is that it became so consistent that it’s now considered the norm. Investors are simply waiting for that bullish announcement.

Unlocks Calendar, a publication of Substacks, has made an observation that is quite similar to this. Unlocks Calendar stated that teams with unlocks on the horizon will typically hold on to positive news for even months until the unlock in a bid to drum up positive sentiments in the market.

AXS stands as one of a number of cryptocurrencies that have managed to gain ground while a token unlocks loom ahead of them. A few examples of this would be the cryptocurrency of dYdX, a crypto exchange focused on decentralized perpetuals. This saw the cryptocurrency outperforming the heavyweights, Ether and Bitcoin, and comes in spite of a looming unlock on the 2nd of February, 2023.

Ali Raza

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