Reports from an over-the-counter (OTC) dealer suggest that the forthcoming unlock of Celestia’s TIA tokens, valued at over $1 billion, may not result in as significant a sell-off pressure as initially feared.
Taran Sabharwal, the founder of Stix, a crypto OTC firm, has indicated that the potential sell pressure could be lower than previously estimated. Only half of the total unlocked tokens (188.5 million) have been unstaked for sale as of October 31st. Sabharwal stated,
“Our analysis indicates that approximately 92.3 million $TIA tokens will be available for trading post the unlock, which sets the upper limit for the selling pressure in the market.”
He further commented,
“This translates to a maximum selling pressure of around $460 million. Notably, this constitutes less than 50% of the total anticipated unlocks, indicating a lower sell-off pressure than what was previously expected.”
Impact on TIA Price Outlook
Analyzing the potential effect of the unlock on TIA’s price, Sabharwal suggested that it could serve as a positive signal for buyers as the reduction in short positions post-initial unlock might counteract the spot-selling pressure. He mentioned,
“We anticipate many of the short positions to continue closing out, mitigating the immediate spot-selling pressure. This reset in funding could signal a bullish trend for spot buyers.”
Several market participants echoed this optimistic perspective, viewing any likely dip as a favorable opportunity to enter long positions. One observer remarked,
“With the market absorbing the unlocked tokens and short positions unwinding, this could present an attractive entry point for those with a positive stance on TIA within the ETH narrative.”
Simon Dedic, a partner at Moonrock Capital, concurred, acknowledging potential short-term volatility but emphasizing an overall bullish setup. He mentioned,
“While short-term fluctuations are possible, the broader outlook appears strongly positive. With Celestia’s positioning as a primary data availability layer, $TIA might be paving the way for a significant upwards movement similar to $SOL.”
However, DeFi analyst Ignas cautioned against an extended downturn, especially amidst concerns that Celestia has only generated $15K since its launch in October 2023.
Market Sentiment Analysis
Recent data from Binance indicates a prevailing bullish sentiment in the market. Long positions have risen over the past three days from 55% to over 60%, signaling traders’ anticipation of a potential TIA recovery.
Currently, the $4.5 mark stands out as a crucial short-term target, having acted as a support level against recent declines since early September. A breach below this level could lead TIA towards lower trading ranges around $3.5.