Key Insights:
- 93 million $SAND has been deposited on Binance.
- Selloff has already started.
- Another 205 million tokens are due for unlock 11 days later.
- Token has already depreciated 94%.
Spot On Chain has reported that 93 million $SAND Tokens(valued at $41.21 million at $0.443) have been deposited on Binance on Feb 02, 2024 through multiple wallets. These tokens were unlocked in the last 1.5 months. The token price is already falling and further selloffs might kill the ecosystem.
Sandbox is a highly popular metaverse platform where users get the experience of virtual metaverses that allow them to buy, create and sell assets while having fun.
Details
The details about the deposits were tweeted by Spot On Chain, a blockchain intelligence platform with highly accurate on-chain signals. On-chain data can easily reveal upcoming token booms and busts.
Through a post on their verified X account, Spot On Chain posted that:
- A total of 4 wallets have deposited a sum of 93 Million tokens.
- These wallets accrued these tokens during the initial days of Sandbox platform.
- These four wallets deposited these 93 million SAND tokens on Binance.
- The deposit took place around 12:01 AM on Feb 03, 2024.
The tokens were deposited for the sole purpose of selling them. They have sold 1.3 million tokens for 556k USDC tokens till Feb 01, a couple of days earlier.
More Token Unlocks Coming?
Sandbox is yet to unlock a token stash that is even bigger than this one. Around 205.59 million tokens are to be unlocked which if sold might wreak havoc on the market.
The next unlock is scheduled to take place around February 14, 2024 and is valued around $90.2 million.
You can track their activities here.
Reason and Result of High Volume Selling
These tokens are being sold as soon as the unlock happens is because the value of $SAND as a cryptocurrency has bene plummeting since Nov 29, 2021, after the crypto markets peaked.
Earlier valued at $7.5 at its peak, the value of $SAND is now less than half a dollar. The fall in price since its peak has been around 94%. This is what might be scaring the users who mostly seem as project contributors. Since project contributors are partially paid in project tokens that are locked for a certain period.
Another reason why these sales seem to be accelerated because metaverse projects are not in vague nowadays. Even Facebook and Disney have long dropped their Metaverse programs.
Lack of further investment has resulted in a token depreciation of most metaverses and blockchain games.
Result of these high value token unlocks could be devastating as the crypto is already in a bearish mode. Its all time high peak was almost 2 years before in November, 2021 where the value of $SAND was at $7.5.
High volume selling could further plummet the price as the daily volumes are around $60 million. Another $90 million tokens would surely lead to a crash of $SAND price to virtually zero.
Shorting Opportunity
Though it seems to be nice shorting opportunity, short selling in bull markets are highly risky trades. To choose the best moment for shorting, you must wait for a corrective phase where Bitcoin, the market leader might see a little selloff. In those moments, buying demand is negligible and any leveraged short may yield high gains.
Another reason why you should wait for a correction in Bitcoin is because the $SAND token is highly correlated with Bitcoin’s price. For every $1 move in Bitcoin, $SAND shows a similar $0.61 move (approximately).
Let’s take a look at daily charts to find any suitable period for shorting is in the near term.
The daily charts show that the cryptocurrency has been straight falling since 26 Dec 2023. Currently, there is a price support at $0.44. If the price breaks below this level, then shorts can be made with a target of $0.30.
However, don’t forget to keep a stoploss at $0.44.
What is Sandbox?
Sandbox is one of the pioneering and also among the most popular metaverses built on the Ethereum blockchain. The project has attracted several thousands of users through its customizable worlds where users can perform a lot of activities such as buying land, construction, create in-game assets, and much more. These assets can be further sold at a higher value.
$SAND is an ERC-20 governance token for the Sandbox Metaverse and allows users to vote in governance proposals that control the future of the platform.
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.
