Celestia Secures $100 Million as $1.13 Billion Token Unlock Looms

Late Monday, the Celestia Foundation announced that it has secured $100 million in funding led by Bain Capital Crypto. This round also saw contributions from Syncracy Capital, 1kx, Robot Ventures, and Placeholder, bringing the total capital raised to $155 million.

The specific allocations of the new funds remain undisclosed.

Celestia (TIA) Price Shoots Up Over 20%

Nonetheless, Mustafa Al-Bassam, co-founder of the Celestia Foundation, highlighted the core developers‘ commitment to a new technical roadmap.

“When Celestia launched last year as the first modular data availability layer, it scaled blockspace from the dial-up era to the broadband era. Now, the core developers have introduced the technical roadmap to scale blockspace to the fiber optic era – while keeping it verifiable and low latency,” Al-Bassam said.

Following the announcement, the market responded positively. The foundation’s native token, TIA, surged by nearly 21% in value, though it later stabilized to a 12.25% increase. Currently, TIA trades at $6.40 with a market capitalization of $1.36 billion. Despite this uptick, the token is still over 65% below its February 2024 highs.

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Interestingly, the timing of this announcement comes just one month before Celestia’s token unlock scheduled for October 31.

“This was an over-the-counter deal done at a $3.5 billion valuation directly with the foundation a few months ago, and I think it also unlocks in October. The investors are breakeven if they sell full unlock at $7.5,” crypto analyst Sisyphus said.

According to data from CryptoRank, this event will release 175.74 million tokens, or 16.4% of the total supply, into circulation. At current market prices, the value of these tokens stands at approximately $1.12 billion, representing a staggering 82.2% of the token’s total market capitalization.

The details of the token unlock are as follows:

• 182,240 TIA for research, development, and ecosystem enhancements, valued at $1.17 million.
• 65.01 million TIA will go to Series A and B investors, totaling $418.52 million.
• 58.08 million TIA have been set aside for initial core contributors, worth $373.9 million.
• 52.47 million TIA are allocated to seed investors, totaling $337.79 million.

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Due to Celestia token unlocks, some traders are planning to short the TIA tokens. However, Sisyphus voiced concerns about potential market volatility surrounding the unlock.

“If too many people are aware of the unlock, it becomes a bad short. Conversely, if it isn’t widely discussed yet, it remains a viable short,” he stated.

This perspective sheds light on the delicate balance traders must maintain in anticipating market movements.

As October approaches, the implications of the token unlock for TIA’s market stability are increasingly coming into focus. Traders should apply stringent risk management practices to mitigate the effects of the expected volatility.