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60 million Polkadots unlocked in February
From January 28 to February 25, a total of 60 million Polkadots will be unlocked.
The market has a concern that this batch of Polkadots will bring strong selling pressure to the market. Could the situation really be that serious?
First of all, we need to understand what is pledge and unstake?
Polkadot pledge refers to the act of binding tokens (DOT tokens for Polkadot) by using tokens as "collateral" to generate valid blocks (thus obtaining block rewards). Validators and nominators pledge their DOTs to protect the network, and the number and duration of pledges are not limited. The main losses are liquidity and losses caused by market fluctuations during this period.
Nominators can unstake at any time. There will be a 28-day unbinding period in the middle, and rewards cannot be obtained during the waiting period.
The long unlocking time shows that those who are willing to pledge are optimistic about the future value of Polkadot, otherwise they will not give up important liquidity. After all, one day in the currency circle, one year in the world, too many things can happen in the currency circle in 28 days.
This time, 60 million Polkadots are about to be unlocked. In fact, you don’t need to worry too much. What’s more important is to understand the possibility behind these actions. We can analyze it in terms of time and purpose.
The first is time. It takes 28 days to unlock Polkadot. The Subscan website shows that the first peak point of 10 million will be unlocked on February 5, and the second and third peak points will be on February 13 and February 17 respectively. Most of the amount this time was concentrated during the Spring Festival, which shows that this batch of unlocking is largely a normal outflow of funds.
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The number of pledges and unstakes in January
There are also many speculations in the market that the slot auction will start from March to April, and those who release their pledges are unlikely to release all their chips at this time, so this time it will flow to the market The number is far from being as large as it appears in numbers.
The second is purpose. Pushing forward 28 days from February 5th is January 8th, and the price on that day is about $10. As mentioned earlier, this release of the pledge is a normal outflow of funds before the year. Taking the current price as the standard, assuming that they wanted to withdraw 100,000 US dollars for the Spring Festival, he needed to release the pledge and sell 10,000 Polkadots, but at the current price, he only needs to sell about 6,000 Polkadots. Cards are fine, and the sales ratio is about 60%, and the remaining Polkadots are likely to be re-pledged or held to wait for the start of the slot auction. This time the unlocking may not all flow into the market. Based on this ratio, only about 36 million of these 60 million unbundled units may actually flow into the market.
Finally, Polkadot staking and unstaking is a very common thing. There is absolutely no need to be intimidated by these numbers. The most important thing is to understand the meaning and possibility behind it before making a decision, rather than being blindly influenced by some data. It has not been easy for Polkadot to go from a low of $4.5 in December to a high of $19.5 in January. Let’s continue to support Polkadot together!
