- An algorithmic trading company bought 17.08 million ARB tokens.
- Market sentiment indicated that the unlock might not lead to a price crash.
Market maker Wintermute Trading has added an incredible $36.3 million to Arbitrum [ARB] Coins. This happened ahead of the token unlock scheduled for March 16.
AMBCrypto noted via data from Spot On Chain that this was not the first tokens the market bought. At the time of writing, the recent purchase meant that Wintermute Trading now owns a total of 29.48 million ARB.
Source:
Freedom may not be a bad thing for ARB
Token unlocking refers to releasing previously locked tokens into circulation. This mechanism implies a greater supply. If demand does not match the circulating supply, the price of the cryptocurrency involved may fall.
Arbitrum’s token unlock is one of the biggest this year. On the scheduled date, the Ethereum [ETH] Layer 2 project plans to Edition 1.45 billion tokens. This represents 15.7% of the total supply and is valued at $2.93 billion.
If market maker sentiment is anything to go by, Arbitrum’s token unlock may not cause a price drop. If so, the potential decline may not last long as there is a belief that it will recover.
At the time of writing, ARB’s price was $2.01. This value represents a decline of 6.50% over the past 24 hours. Despite the recent setback, sentiment around the project has changed. Previously, ARB’s weighted sentiment was negative.
But by March 13, the result had become negative. Weighted Sentiment tracks the positive/negative commentary about the Arbitrum project. Hence the press time reading of the metric suggests that the discussion around ARB has been bullish.
As such, it is possible for traders to place large bets on long positions. Beyond broader market sentiment, AMBCrypto noticed a significant change in the number of ARB holders.
Source: Santiment
Only after the event?
Three months ago the number of holders was 985,000. But at the time of writing, the number has increased to 1.17 million. Such a rise implied that buyers are confident in the long-term potential of the token.
On the social side of the market: on-chain data showed that Arbitrum’s dominance has increased. Compared to other assets on the market, the increase in social dominance means that discussions about the project have increased.
While an exponential increase in social dominance could mean a local peak, Arbitrum’s case was different as it was not unusually high. So the token can have good upside potential after unlocking the token.
Source: Santiment
How much are 1,10,100 ARBs worth today?
In the meantime, the active addresses on the network had decreased. At 24,900, the active addresses indicated that speculation surrounding ARB had decreased. When speculation decreases, so do the sales opportunities.
However, this does not mean that ARB’s price may not fall below $2 towards the unlock. While this is possible, statistics agree that a rally could be in the making after supply increases.