Token unlock
Also called: unlock · vesting unlock · token release
Definition
A token unlock is a scheduled event when previously locked tokens, usually held by the team, investors or a treasury, become free to transfer and sell, increasing circulating supply.
This entry is shown in English.
How Token unlock works
Most new projects do not release all tokens at launch. Insiders' tokens follow a vesting schedule, often with a cliff, a waiting period, followed by monthly or daily releases. Some unlocks are linear and small; others are one large cliff unlock that releases a big share at once.
Unlocks matter because they add supply. If the people receiving tokens bought them at much lower prices, some may sell. Traders often watch large unlocks, especially those over a few percent of circulating supply, because they can weigh on the price. The market sometimes prices this in before the date.
An unlock does not mean recipients will sell. Some stake or hold, and some unlocks go to ecosystem funds that release tokens slowly. Check who receives the tokens, how large the unlock is relative to daily trading volume, and whether similar past unlocks led to selling.
Example
Suppose a token has 400 million in circulation at 0.80 USDT, a market cap of 320 million USDT, and averages 25 million USDT of daily trading volume. Next Tuesday, 60 million tokens unlock for early investors who paid 0.10 USDT. That unlock is 15 percent of circulating supply and worth about 48 million USDT at today's price, almost two days of normal trading volume.
Common mistakes
- Ignoring the unlock calendar before buying a recently launched token.
- Assuming every unlock causes a price drop; size, recipients and timing all matter.
- Comparing an unlock to total supply instead of to circulating supply and daily volume.
Learn and practise
FAQ
Do token unlocks make the price go down?
Not always. Large unlocks to insiders with low cost bases can add selling pressure, but the effect depends on demand, how much was already priced in and whether recipients sell.
Where can I see token unlock schedules?
Project documentation usually lists vesting terms, and token unlock tracking sites show upcoming events in a calendar.
What is linear vesting?
Linear vesting releases tokens in small equal amounts over time, such as every day or month, rather than in one lump sum.