How do IPO lockup expirations affect the price of digital currencies?

3 answers

• Dec 25, 2021 · 3 years ago
  When IPO lockup periods end, early investors and insiders are allowed to sell their shares, which can increase the supply of digital currencies in the market. This increased supply can potentially lead to a decrease in the price of the digital currency as the market becomes flooded with more coins. However, the impact on the price will depend on various factors such as the overall demand for the digital currency, market sentiment, and the size of the lockup expiration. It's important to note that not all lockup expirations will have a significant impact on the price, and the market's reaction can be unpredictable.
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• Dec 25, 2021 · 3 years ago
  IPO lockup expirations can have both short-term and long-term effects on the price of digital currencies. In the short term, the expiration can create selling pressure as early investors and insiders cash out their holdings. This selling pressure can lead to a temporary decline in the price. However, in the long term, the impact may be less significant as the market adjusts to the increased supply. It's also worth noting that the price impact may vary depending on the specific digital currency and its market dynamics.
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• Dec 25, 2021 · 3 years ago
  According to a study conducted by BYDFi, IPO lockup expirations have shown mixed effects on the price of digital currencies. While some lockup expirations have resulted in price declines, others have had minimal impact or even led to price increases. The key factors that determine the price impact include the size of the lockup expiration, the overall market conditions, and investor sentiment. It's important for investors to carefully analyze the specific circumstances surrounding a lockup expiration and consider other market factors before making any investment decisions.
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