Pi Network’s 275 Million Token Unlock Threatens to Crush Price—Here’s Why

Supply shock incoming: Pi Network’s massive token release could send prices spiraling.

When 275 million tokens hit the market, even crypto’s most devout bag-holders start sweating. Pi’s ’fair distribution’ model? About to meet the cold reality of sell pressure.

Remember: In crypto, ’unlock’ often means ’unleash the dump’.

Bonus cynicism: Another day, another project discovering that tokenomics works better on PowerPoint slides than in actual markets.

Pi Network Braces for June Unlock

According to data from PiScan, PI Network is scheduled to unlock 276 million PI tokens in June. At market prices, these tokens are currently valued at approximately $176 million. 

With market participants already cautious due to ongoing price weakness and low trading volume, the timing of this unlock could be particularly disruptive. Generally, an influx of tokens leads to heightened selling pressure, especially when investor sentiment is already bearish and there is no adequate demand to absorb the new supply.

This is the case with PI, as readings from its daily chart show signs of a continued decline in capital inflows. For example, the token’s Relative Strength Index (RSI) is in a downward trend and below the 50-neutral line at 40.49.

The RSI indicator measures an asset’s overbought and oversold market conditions. It ranges between 0 and 100. Values above 70 suggest that the asset is overbought and due for a price decline, while values under 30 indicate that the asset is oversold and may witness a rebound.

PI’s RSI readings indicate a preference among market participants for distribution over accumulation. If this trend continues, its price could continue to slip. 

Furthermore, the token’s Aroon Down Line is at 86%, confirming the strength of the decline. The Aroon indicator is used to identify trend direction and strength. When the Aroon Down line is close to 100%, it suggests that recent price action has consistently hit new lows, indicating strong bearish momentum. 

At 86%, Pi’s Aroon Down level signals that the asset has been making lows with high frequency, with little to no correction recorded recently.

 Pi Price Slips Toward $0.40 — Breakdown or Bounce Ahead?

At press time, PI trades at $0.63. With strengthening selling pressure, PI bears could push its price toward its all-time low of $0.40. 

If this support floor fails to hold, the altcoin could fall to new lows.

However, a resurgence in new demand for the token WOULD invalidate this bearish outlook. In that scenario, PI could rebound and rally toward $0.86.