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EIGEN Whales Cash Out Amid Price Drop Ahead Of Token Unlock
A recent development in the cryptocurrency market has left investors wary as large holders of Eigen (EIGEN) tokens have begun cashing out amid a sharp price drop. This sudden sell-off is particularly concerning given that it comes ahead of a token unlock event scheduled for December 24.
According to reports, several major addresses have already redeemed a substantial amount of EIGEN tokens from the EigenLayer staking contract and are selling them on-chain for Ethereum (ETH) or USD Coin (USDC). This mass redemption has led to an increase in selling pressure on the token, which is likely to continue as more whales cash out.
In October, these same large holders collectively spent a staggering $32.45 million USDC across 21 addresses to acquire approximately 8.917 million EIGEN tokens at an average price of $3.64 each. However, their recent decision to sell off their holdings may have significant implications for the token’s future performance.
The whales’ initial investment seems to have paid off well, with EIGEN reaching a peak price of $5.60 just days ago. This gain translates to an impressive profit of $17.65 million, allowing them to lock in substantial returns on their initial stake. However, it appears that these investors are now opting to cash out their gains ahead of the token unlock event.
The scheduled unlock of 0.61% of EIGEN’s total supply (worth approximately $4.83 million) may introduce additional selling pressure, which could have a devastating impact on smaller investors. This is not an unusual phenomenon, as we’ve seen similar trends with other newly launched tokens like ENA and MOCA in the past.
While some market makers have defied expectations by sustaining or even increasing token prices after unlock events, it’s essential for EIGEN holders to prepare themselves for potential turbulence during this period. Keeping a close eye on market activity will be crucial for navigating these uncertain times.
As always, we urge investors to thoroughly research and understand the intricacies of the cryptocurrency market before making any investment decisions.
Source: nulltx.com
