I hope you all have seen these news about Celsius Token Sale. Celsius is gearing up for a token sale that is set to have a significant impact on several altcoins in the market. With a whopping $70 million worth of Celsius's native token, CEL, and around $52 million of MATIC (Polygon) being sold, investors are eagerly watching the potential consequences.
MATIC, being one of the tokens facing the largest sales, is likely to experience some price fluctuations. As Celsius converts customer altcoins into BTC and ETH, the increased supply of MATIC in the market could potentially lead to a temporary decrease in its value.
In addition to MATIC, other tokens that will be sold include ADA (Cardano), LINK (Chainlink), LTC (Litecoin), DOT (Polkadot), BCH (Bitcoin Cash), AAVE (Aave), UNI (Uniswap), XLM (Stellar), SOL (Solana), EOS, FIT, SRM (Serum), and BNB (Binance Coin).
The substantial sales of these altcoins have the potential to impact their prices in the short term. Traders and investors will closely monitor the market to gauge the response of these tokens, as increased supply could put downward pressure on prices.
According to Bitcoin.com:
The firm filed its plan on June 15, and as per the latest revisions, customers who possess “altcoins” will have their balances converted to BTC and ETH on July 1.
Although the plan to convert the altcoins to BTC and ETH still needs to be approved by the bankruptcy court, the traders will start selling all these tokens before the news is definitely confirmed, as usual, and the impact could be particularly huge for MATIC due to the large amount involved.
That's why I decided to sell MATIC for another token that would not be affected by these news. As I think one of the most important factors is Mcap/TVL, I compared the Mcap/TVL of these tokens by using Defillama:
This table shows that Arbitrum (ARB) has the lowest Mcap/TVL ratio. Therefore, I decided to sell all my MATIC tokens for ARB.
Although I am aware that ARB is a risky asset too, I think it has more chances to succeed than MATIC, which is overvalued as per this ratio compared to ARB. Furthermore, Polygon team recently confirmed that in the upcoming Polygon 2.0 the gas fees will only be paid in ETH, positioning MATIC as a governance token similar to ARB. On top of that, the major innovation of Polygon 2.0, a.k.a. "supernets", is only a copy of Optimism superchains, and Optimism has not yet managed to really challenge Arbitrum with that also loudly announced innovation.
It is also worth noting that, as per the table above, Solana (SOL) has the worst (highest) Mcap/TVL ratio of the top 11 chains since the investors are not really coming back onto this chain. As SOL is also among the cryptos which should be sold by Celsius, it could also be affected by this huge token sale.
In the short term, BTC and ETH could still be the safest assets for investors, and only a few altcoins could outstand them. The challenge is to find them. Happy hunting to everyone!
Disclaimer: The information provided in this post is for informational purposes only and should not be considered financial or investment advice.
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