Celestia entered a major price increase over the week, in what speculators are calling a “short squeeze”.
The cryptocurrency is set to unlock more than $1 billion worth of tokens in October.
With this in mind, investors should be careful when interacting with the protocol.
Other major token unlocks include Aptos, Arbitrum, Axie Infinity, ImmutableX and more, all amounting to more than $2 billion worth of releases.
October, often called “Uptober” because of its generally bullish sentiment, is set to be massive for the crypto industry.
Nearly $2 billion in assets are set to be unlocked from several major projects.
The biggest out of these is the upcoming release of $1.1 billion Celestia (TIA) tokens, scheduled for 31 October.
This upcoming unlock is also set to arrive alongside other projects like Cheelee and Aptos
Both of which are set to release hundreds of millions worth of tokens.
So what will happen with Celestia’s $TIA from now until then? Should you bet on this cryptocurrency, or run for the hills?
Let’s find out.
Celestia, for some context, is a modular data availability network.
Its main aim is to help developers launch new blockchains quickly and easily. This means that it is a big deal in the crypto space.
However, this project is also set to release a whopping 175.75 million $TIA tokens at the end of October.
This unlock will be worth an insane $1.1 billion, and represents a huge portion of the unlocks for the entire month, as well as Celestia’s total supply.
Upcoming unlocking events
According to data from Token Unlocks and DropsTab, the tokens will be distributed to the project's core contributors.
Other recipients will include the research and development team, as well as Series A and B investors.
Interestingly, Celestia as a project entered the limelight in late 2023, with the price of $TIA reaching an all-time high of $20.85 by February 2024.
However, so far, the token has fallen down to a current price of around $6.51.
Despite the recent price slump, the cryptocurrency saw a brief rally sometime during the week, in what some are calling a short squeeze.
For context, short squeezes happen in financial markets, where the price of an asset rises unexpectedly.
When this happens, bears are forced to close their positions.
In turn, this leads to further buying pressure on the asset—therefore it rallies even further.
Celestia’s funding rates
Furthermore, funding rates in $TIA perpetuals have also recovered to nearly zero according to Coinglass.
This comes after the metric traded at highly negative rates since July.
Celestia’s funding rates
In essence, this means that the recently removed shorts were crowding the market.
It also explains why experts are calling the cryptocurrency’s price movement a short squeeze.
Celestia is currently consolidating and is now down by around 4% on the daily timeframe.
According to analysts like “Cold Blooded Shiller”, Celestia is “very well set up” for a good weekend play in the market.
According to the analyst, a great price target for the cryptocurrency is the $7.5 zone, where investors should consider taking profits at, if we see movement.
Analyst Scient also shared the chart snapshot below:
According to the analyst, if Celestia can flip the $6.5 zone into a support, the cryptocurrency will undoubtedly rally straight forward towards the $6.5 price level.
This outlook, interestingly, aligns with the outlook of the previous analyst.
With this being said, investors should consider planning trades carefully.
Another catalyst for $TIA’s mid-week rally was the announcement of the fresh $100 million fundraise by the Celestia Foundation.
This new funding round has so far brought the Foundation’s total cash reserve to an impressive $155 million.
This is despite how the team hasn’t yet revealed the exact plans for the funds.
According to commentator Chris Burniske, the fundraising was likely to have been an over-the-counter (OTC) deal.
Burniske speculated that the tokens were priced at around $3 per token, with the cryptocurrency’s total market cap estimated at $3.4 billion.
This is also without mentioning that one-third of the newly sold tokens will be unlocked on 30 October.
This means that investors should be extra careful with Celestia within the month.
More than Celestia, October’s major token unlocks also include Cheelee.
Within the month (as early as the 10th), the platform is gearing up to release a staggering $300 million worth of vested tokens.
These will be allocated to various stakeholders including advisers, reserve funds, marketing efforts, liquidity providers, team members and private investors.
Interestingly, Celestia and Cheelee account for a total of 70% of the total unlocks for October.
Other notable ones include Aptos, which is scheduled to release $90 million in APT tokens on October 12.
Others include Arbitrum, Axie Infinity, ImmutableX and GateToken with between $50 million and $70 million.
Others like Starknet, Internet Computer and Ethena Labs will unlock between $20 million and $30 million.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.