ApeCoin Treasury to unlock 25 million APE tokens for launch contributors – Decrypt | Jewelry Dukan

Shortly

  • ApeCoin’s “launch contributors” are expected to collectively receive 25 million APE tokens, or a value of approximately $115 million as of this writing.
  • APE’s price is down about 9% today ahead of its release amid questions about whether recipients will launch their tokens.

ApeCointhe ether-based token created for the Bored Ape Yacht Club NFT ecosystem launched in March with immense hype (and significant paydays for BAYC holders). Now, some of the project’s backers will be rewarded with over $115 million worth of APE tokens, leaving holders wondering how this unlock might affect the price of the token.

On Saturday the ApeCoin DAO Treasury is expected Unlock 25 million APE tokens allocated to “launch contributors” who, according to the website, are the unnamed “companies and individuals who helped make this project a reality.” The 25 million tokens are set to be unlocked six months after the launch of ApeCoin, which took place on March 17.

At the current price of $4.61 per token, that’s just over $115 million in tokens set to hit the market, adding about 8% to the circulating supply. ApeCoin was created with a permanent supply of 1 billion tokens, with just over 318 million APE currently in circulation. The rest will be unlocked over a four-year period from March launch.

It is unknown who falls under the Launch Contributors banner. In a new report from the crypto industry research firm Delphi Digital writes that the list may include supporters of Bored Ape Yacht Club inventor Yuga Labs who Raised $450 million at a valuation of $4 billion in March.

The research firm pointed to investment firm Andreessen Horowitz, Animoca Brands and FTX Ventures as likely beneficiaries. decrypt contacted Yuga Labs for clarification, but did not immediately receive a response.

It is worth noting that Yuga Labs is not described as the creator of ApeCoin, apparently for regulatory compliance reasons. The ApeCoin Foundation acts as the “Manager” of the tokenand it is governed by the ApeCoin DAO, or Decentralized Autonomous Organization — essentially an online group united by a common purpose with token-based membership.

Whether such contributors will hold their tokens or dump them on the open market remains to be seen, but the impact of an incoming increase in circulating supply raises questions about how the market will react to the tokens being unlocked.

Prior to the release, the price of APE has already dropped by almost 9% in the past 24 hours, according to data from CoinGecko. It’s now down 26% in the last 30 days.

“The million dollar question is whether the launch contributors will sell their tokens after the release. This will result in significant selling pressure on APE,” the Delphi authors write. “No one knows, but we can posit that if they are long-term investors in Yuga Labs, there’s a reasonable chance they’ll keep most of the tokens unlocked.”

However, with the apparent imminent launch of ApeCoin staking, there could be significant incentive for launch contributors to hold on to their tokens.

In May, ApeCoin holders voted to select Horizen Labs to build the staking system that will provide token rewards for users who stake (or hold) APE or Bored Ape.Mutated Monkey NFTs within the network. Horizen Labs recently announced development progress and plans to do so Host a Twitter Space next week to discuss details surrounding the initiative.

Delphi Digital NFT analyst Teng Yan described ApeCoin’s initial staking rewards as “pretty juicy” and suggested that eligible NFT holders could buy large amounts of APE to participate in staking. Demand could push the token’s price higher, while staking could also drain significant APE liquidity from the market.

However, Teng said questions remain about the potential utility of ApeCoin. The token was developed to enable Web3 applications such as metaverse Games, including Yuga’s own upcoming ones Other side Experience. Teng writes that growing utility will be needed to sustain long-term demand for the token.

“A big question is what will happen to the price of APE if staking continues,” he wrote. “APE is inflationary and the circulating supply will expand as rewards are distributed. New buyers are needed to hold the price.”

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