How Will Token Unlock Affect DYDX Price? | Credit: Hameem Sarwar
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Key Takeaways
DYDX’s circulating supply increased by more than 11% due to a cliff unlock on April 1.
The DYDX price has trended downward since reaching a yearly high of $4.52 on March 7.
Will there be similar token unlocks in the near future, or will the token’s inflationary supply stabilize?
dYdX is a decentralized perpetual futures trading exchange, which uses zk-rollup technology with Ethereum as the parent blockchain. While it initially functioned as a hybrid decentralized exchange, it became fully decentralized after the release of dYdX v4. Its native token is DYDX.
On April 1, more than 33 million tokens were released, increasing the circulating supply by more than 11%. Such inflationary pressures often result in a price decrease. Will this particular token unlock cause the DYDX price to fall below $3?
How Did the Unlock Affect Supply?
Before the recent unlock, the circulating supply for DYDX was 293 million. Therefore, the 33 million amounted to an increase of over 11% for the circulating supply, which has now jumped to 326 million.
From the unlock, 18.5 million DYDX went to investors, while 10.2 million went to founders and advisors”. Meanwhile, 4.6 million went to future employees. Although more DYDX tokens will be released before the end of 2026, this was the final cliff unlock.
DYDX Unlock Schedule | Credit: Token.Unlock
A cliff unlock refers to a lump sum release of tokens over a certain time period. A linear vesting schedule often follows a cliff unlock, as is the case for DYDX. In a linear vesting schedule, the release of new tokens will be done periodically at smaller amounts. For DYDX, new unlocks will not be larger than 2% of the total supply. The maximum supply of one billion will be reached on June 1, 2027.
LP Vaults coming soon to help bolster liquidity for all markets on protocols using dYdX Chain software! These will be especially useful for newer markets that likely have limited liquidity! ?https://t.co/pL2XdAhuIQ
dYdX announced new innovations in March, more specifically the introduction of LP vaults, which will help address liquidity problems for new markets. On that note, dYdX added 15 new markets in March.
Compared to its main competitor GMX, a similar decentralized trading platform on Avalanche, dYdX has nearly twice the Total Value Locked at $392 million.
DYDX Price Prediction: Will Price Fall Below $3?
The DYDX price has increased alongside an ascending parallel channel since the start of the year. Both the resistance (red icons) and the support (green icons) trend lines of the channel have been validated numerous times.
After an unsuccessful breakout attempt in the beginning of March, DYDX fell below the $3.60 horizontal area, which will likely provide resistance. The drop also confirmed that the attempted breakout was just a deviation (red circle).
DYDX Weekly Chart | Credit: TradingView
Currently, DYDX risks breaking down below the channel’s midline, while the weekly MACD has nearly made a bearish cross. A similar bearish cross (black circle) caused a drop to the channel’s support trend line in January 2024.
Presently, a similar movement would cause a 30% drop to the channel’s support trend line at $2.30.
On the other hand, a weekly close above the $3.60 resistance area will render this short-term bearish prediction invalid. Then, the DYDX price can increase to the channel’s resistance trend line.
DYDX Price Faces Difficult Road Ahead
On top of its inflationary pressures, the DYDX price failed to break out from its long-term channel pattern. This weakness in price can lead to a significant drop toward its support trend line. The DYDX trend is likely bearish until the price breaks out from this channel.
Valdrin Tahiri is a cryptocurrency analyst and reporter at CCN, specializing in technical analysis with a focus on Elliott Wave theory, on-chain metrics, and fundamental research. He brings over seven years of experience in the crypto space as both a trader and writer.
He discovered cryptocurrencies in 2017 while earning his MSc in Financial Markets at the Barcelona School of Economics, which sparked a deep interest in blockchain and market dynamics. Since then, he’s contributed to top crypto outlets like BeInCrypto and CoinGape.
Valdrin also served as Community Manager of BeInCrypto’s Telegram group for three years, helping grow it into one of the largest crypto communities worldwide. His expertise in market structure and price patterns allows him to break down complex trends into clear, actionable insights.
He’s published thousands of articles covering altcoins, Bitcoin cycles, and macro trends.
