Axie Infinity’s AXS price steadies ahead of a $175M token unlock

Axie Infinity (AXS/USD) price has wavered recently as investors wait for the upcoming token unlocks. AXS token was trading at $9.3, which is a few points below this month’s high of $9.75. It has risen by more than 35% above the lowest level in March.

Axie Infinity token unlocks

Axie Infinity is one of the biggest players in the GameFi and NFT industries. The platform makes it possible for anyone to play games and then get rewarded for climbing the ladder. These players are mostly paid using the Smooth Love Potion (SLP) token. And in some cases, players receive AXS tokens.

One of the top cryptocurrency news is the upcoming Axie Infinity token unlock. Data shows that Axie Infinity will unlock a bunch of tokens on April 23rd of this year. In this unlock, the developers will unlock over 18 million AXS tokens, which are currently valued at over $175 million. Based on the current valuation, these tokens are about 7% of the total market cap.

Axie Infinity has been unlocking tokens in the past few years. Data now shows that the total locked supply of AXS tokens is about 28.8%. According to its schedule, all tokens will be unlocked in 2025.

In most cases, token unlocks are usually seen as negative for the crypto token since they lead to dilution. For example, according to CoinMarketCap, the total AXS in circulation now stands at more than 11.9 million. This gives it a market cap of $1.01 billion. 

Therefore, by bringing the new tokens to the ecosystem, it will be dilutive to existing holders. Early this year, dYdX was forced to postpone its $150 million token unlock.

However, in some cases, we see tokens rise after dilutive measures. For example, Ethereum is trading at $2,000 after the Shapella upgrade that made it possible for people to withdraw their staked tokens.

Axie Infinity price prediction

AXS chart by TradingView

Is it safe to buy Axie Infinity? The 4H chart shows that the AXS token has been in a bullish trend in the past few days. It has jumped from the year-to-date low of $6.8860 to a high of $9.80. The token has risen above the 25-day and 50-day exponential moving averages.

Axie Infinity is approaching the important resistance point at $9.80, the highest point on March 18. It has moved slightly below the upper side of the ascending channel. Therefore, there is a likelihood that the token will move to the lower side of the channel at ~$8.80. However, a move above the key resistance point at $9.80 will signal that there are still buyers in the market.