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All About Token Unlocks

As the bear market grinds on, investors and speculators alike are scrutinizing metrics even further. One that has come to light is upcoming unlocks and increases in token supply. While serious thinking about tokenomics was often thrown out the window during the bull market, as prices have gone down, people are looking at these numbers in more detail.

What are token unlocks?

Token unlocks release a portion of a project’s tokens at the end of a vesting or lock-up period. These tokens are typically held by the project’s team and investors and are subject to certain restrictions on when they can be traded or transfered. Token unlocks usually mean that the tokens can be sold. These previous locked tokens enter the market, often leading to a significant increase in the supply of the cryptocurrency.

Token unlocks can also refer to the process of releasing new tokens, either through a token sale or airdrop, to the general public. In these cases, the tokens are made available for purchase or are given away for free to individuals who meet certain requirements, such as holding a certain amount of a different cryptocurrency.

Token unlocks can have a major impact on the supply, which in turn can affect the price. They are also important for the project’s investors and stakeholders, as they may be able to sell their tokens for a profit once they are unlocked.

In short, unlocks lead to an increase in the circulating supply of a token and are closely watched for the impact on price.

What is the difference between circulating supply and total supply?

In crypto, the total supply of a token refers to the maximum number of token units that will ever exist. This number is determined by a project’s tokenomics. Sometimes the supply is fixed while other protocols have continued inflation and printing of new tokens.

Circulating supply refers to the number of units of a token that are currently available on the market and can be traded.

The relationship between the total supply and the circulating supply can have a significant impact on the price of a token. For example, if the total supply of a cryptocurrency is very large but the circulating supply is relatively small, the price of the cryptocurrency may be driven up due to high demand and a limited supply. Conversely, if the total supply is small but the circulating supply is large, the price of the cryptocurrency may be driven down due to an excess supply.

It is important to consider both the total supply and the circulating supply when evaluating the value of a cryptocurrency. This information can help investors understand the potential supply and demand dynamics of the cryptocurrency and make more informed investment decisions.

Upcoming Token Unlocks in 2023


The dYdX token is used to govern the protocol and give token holders the ability to participate in decision-making processes related to the development and maintenance of the protocol. The dYdX governance process involves various levels of voting with the dydx token in order to propose and implement governance actions.

The dydx token is also used to pay for incentives for traders and market makers.

With the upcoming token unlocks the dydx supply is going to more than double.


OP is the native token of Optimism, the Layer 2 optimistic rollup. The token is used in Optimism unique multi-chamber governance system. This lets OP holders propose and vote on governance actions like the distribution of further OP tokens.

Beyond governance, the OP token has been used to distribute huge amounts of rewards through a wide-ranging grant program. In order to boostrap the network with additional liquidity and reward early projects, OP token was given out based on proposals for each project.

The additional token unlocks will go partly to investors and partly to continue incentives and grants on the network.

What are Bullish Unlocks?

Many times token unlocks can play into volatile price action and create new narratives around why a token’s price is moving. When token prices rise after an unlock, this is considered a bullish unlock. It may be because there will be less future sell pressure, or the circulating supply is finally matching the max supply. Sometimes it is just plain speculation.


A good example of a bullish unlock is LDO. Their last investor unlock occurred just a month ago. With all of the token unlocks done, and a building narrative around liquid staking derivatives going into the Shanghai fork, LDO has mooned in the month after the unlock.

While the fundamentals and bear market backdrop haven’t changed, the token unlock gave additional fuel to the narrative fire that has grown along with the price.

There is still lots of alpha in paying close attention to a projects tokenomics. Watching token supply and unlocks has become a meta move for investors and speculators.