Tokens worth over $587 million of Ethereum scaling protocol Optimism are set to be released into the open market on Tuesday as part of a planned unlock plan, leading to prices of OP tokens falling 7%.
When tokens are “unlocked,” their holders are then able to sell or swap that token if they wish to do so.
The more than 386 million optimism tokens are currently held by early contributors and investors, and the move will nearly double OP’s circulating supply – which stands at 335 million tokens on Tuesday morning.
Early investors are likely sitting on significant gains and could choose to take profits, contributing to immense selling pressure. As such, immediately available liquidity on OP token pairs across decentralized and centralized exchanges is under $10 million – and a single sell order of $600,000 could dunk prices 2% further on Binance.
The unlock comes as OP tokens have been on a general downturn since February this year, sliding from $3 to $1.5 even as bitcoin (BTC) and ether (ETH) gained at least 50% in that period.
OP trades at $1.50 as of Tuesday, with a trading volume of $103 million over the past 24 hours.