ApeCoin and AXS - a race to Zero?People keep asking me "Is altcoins season coming and Which altcoins i should buy now?"
I would tell you that most of the altcoins from previous bull markets seem compromised due to unfavorable tokenomics and a looming overhang of unlocked tokens.
There's a possibility they may never recover, and it's imperative that we identify a fresh narrative for the upcoming generation of altcoins to gain popularity. In the interim, it appears most logical to maintain exposure to Bitcoin.
Crypto VCs are facing significant pressure to deliver returns to their investors.
Although certain crypto VC funds have generated returns ranging from 10 to 20 times the initial investment, others have experienced significant losses, prompting investors to opt for cashing out, even when potential returns were considerably higher.
These VC funds are expected to continue playing a pivotal role as sellers of altcoins and are compelled to liquidate their holdings.
Monitoring the token unlock schedules of these projects can yield substantial alpha, as the anticipated selling pressure is likely to lead to decreased token prices.
ApeCoin APE
As of September 17, ApeCoin is poised for yet another substantial unlock, this time amounting to $55 million, which represents 11% of the total outstanding tokens.
This is significant given the current ApeCoin market cap of $500 million. Since the last unlock on August 17, which involved 4.2% of ApeCoins (equivalent to $21 million), prices have witnessed a sharp decline of -24%. Furthermore, the one-year emission or dilution rate stands at an alarming 58%.
Axie AXS
On October 20, a significant unlocking event is scheduled for Axie Infinity's token (AXS), involving 11% of the total tokens.
Since the previous unlock on July 22, the value of AXS tokens has experienced a notable decrease of -32%. Presently, AXS maintains a market capitalization of $590 million, reflecting a substantial decline of -97% from its peak in November 2021 when it reached $10.5 billion. Additionally, the one-year emission rate stands at 24%.
Hard time for AXS and APE holders
Even though their prices have fallen considerably, it's difficult to envision a significant rally for ApeCoin or Axie Infinity tokens. These tokens are expected to lag behind the broader cryptocurrency market in terms of performance.
