The dYDx crypto price has made a spectacular recovery in the past few days as investors reacted to the postponement of the token unlock program. The token surged to a high of $2.62, the highest point since November 15 last year.
Why is dYDx price soaring?
dYDx is a leading crypto exchange that is relatively different from centralized platforms like Coinbase and Binance. It’s main difference is that it is a decentralized exchange that is controlled by a DAO.
A key part of the dYdX ecosystem is that of token unlocks. A token unlock is a situation where a blockchain releases tokens as part of its tokenomics. It can be compared to what happens when a company’s lockup expiry happens.
As I wrote last week, the developers were to release millions of tokens, which would have diluted existing holders of the token. In a statement, the company said that they would postpone the unlocking of these tokens.
30% of these tokens will now be unlocked on December 1. They will be followed by 40% in equal monthly installments on the first day of each month starting from January 1 next year to June 1. 20% of the tokens will then be released in equal installments on the first day of the month from January 1, 2024 to June 1 2025.
Similarly, 10% of the tokens will be released in equal installments from Jan 2025 to June 1,2026. Therefore, the postponement has brought some relief among dYdX token holders.
dYdX price prediction
The four-hour chart shows that the dYdX crypto price has been in a strong bullish trend in the past few weeks. The token rose above all moving averages and the psychological levels at $2 and $2.5. The Relative Strength Index (RSI) has moved to the overbought level.
Therefore, the token will likely continue rising as buyers target the next psychological level at $3. The stop-loss of this trade will be at $2