In this article we delve into the tokenomics of Celestia’s cryptocurrency (TIA) and see what the next important unlocks will be.
The currency, launched with an airdrop in October 2023, is experiencing extraordinary performance in the market and this could be partly due to the tokenomics that stimulates price increases in the first year of life.
Something, however, could change in the coming months when the tokens of investors and initial contributors will be unlocked and increase the circulating supply of Celestia.
Meanwhile, the cryptocurrency reached a price of over $20 yesterday for the first time: how long will TIA’s unstoppable rally last?
All the details below.
Summary
Celestia: analysis of the tokenomics of the TIA cryptocurrency
The continuous price increases of the Celestia cryptocurrency (TIA) could be partly due to its revolutionary tokenomics that greatly reduces the circulating supply in the initial phase of the coin’s life, as well as obviously the notoriety that the project has achieved in the blockchain field.
We remind you that Celestia was officially launched in October 2023 through an airdrop that rewarded a wide range of actors in the web3 such as developers, users of Ethereum’s layer-2, and ATOM and OSMO stakers.
Often the tokenomics of cryptocurrencies distributed through airdrops creates a lot of inflation and generates the conditions for a strong initial downturn, but this is not the case with Celestia.
After the official launch in October, the TIA currency took only 10 days before starting the upward climb that led it to increase its initial value by 10 times.
As mentioned, this could be due to a tokenomics carefully designed by the project team, who understood how to stimulate the market.
By taking a closer look, we can see how at the debut of the cryptocurrency, the allocation was distributed as follows:
- 26.8% reserved for research and development. The capital is in the coffers of the Celestia Foundation and the core team;
- 20% public, divided between genesis drop and incentives and future initiatives;
- 19.7% allocated to project supporters (series A&B);
- 17.6% reserved for Celestia Labs members;
- 15.9% for project supporters (seed).
The maximum supply is set at 1 billion TIA tokens, and the circulating supply will gradually increase over time.
Currently, we have a total of 157,701.06 circulating coins, which is approximately 15.7% of the total, and in the first year the share will reach 25% with an estimated inflation of 8%.
Every year after the first, the latter will decrease by 10% until after 20 years it will stabilize at the threshold of 1.5%.
This type of tokenomics mechanism strongly encourages price increases in the first year of Celestia cryptocurrency’s life, where we can only count on ¼ of the total supply available on the market.
Another factor to consider in Celestia’s tokenomics is the vesting of the airdropped tokens to the community, which will see the first unlock in October 2024 and continue for the next few years.
In particular, it should be noted how only a portion of the airdropped coins were unlocked immediately, with developers being able to use 25% of their allocation, while initial contributors and investors (seed and series A/B) are still waiting for their turn.
As you can see in the following image, from the beginning of the first year after the TGE (October 2024), the circulating supply of the cryptocurrency will immediately increase from 250 million tokens to almost 500 million, practically doubling in an instant.
In 2025, the TIA tokenomics then predicts an increase in circulation to 750 thousand tokens with a slow and continuous progressive increase until it gets closer and closer to the maximum supply.
With these characteristics, it is very likely that as October approaches, the possibility of seeing a drop in the value of TIA will increase, since the market will start pricing in advance the potential sales of investors who still do not have the cryptocurrency available.
Eyes focused on TIA during the period from June to October: it is right there that Celestia’s currency will have to prove that it knows how to withstand the speculations related to the upcoming unlocks: if it manages not to depreciate too much in that context, it could conclude its first year of life celebrating an excellent performance.
Another leg up coming for Celestia’s currency?
Setting aside now the tokenomics discussion of the Celestia cryptocurrency, which raises a warning bell about possible mass sales of the coin in the period leading up to October, let’s see what the short-term trend of TIA will be.
Yesterday, Celestia reached a price of 20 dollars for the first time, surpassing the market capitalization of 3 billion dollars with a FDV of over 19 billion dollars.
Started with just 300 million in market capitalization, it has increased its value tenfold in just 2 and a half months: absolutely insane!
Regarding the price analysis, we can immediately confirm that the bullish trend on the cryptocurrency is very strong.
The quotes remain firm above the EMA 50 on the 4-hour time frame, with every attempt to break down proving to be an excellent buying opportunity in the short term.
The market volumes are maintaining a good average, accompanying every bull incursion. The RSI indicator still allows for an upward movement, despite a small divergence formed in the last trading hours.
At the beginning of the year, Celestia’s currency broke out of a short range that had formed in the second half of December, on which we had taken a brief pause from the rise.
With the break of $16, the doors have opened for another leg up in the price of TIA, which ended up temporarily breaking the $20 mark before returning to the $19 zone.
At the moment, unless the recent drop in the last few hours ends up breaking the local support of $18, we can easily expect another bullish breakout with Celestia entering the phase of “price discovery”.
The performance of Bitcoin in this context could influence the price action of the cryptocurrency, although so far it has shown to not care about the performance of the market king and to go its own way.
Anyway, a strong rise in BTC would certainly also lead to an upward trend for TIA. At the same time, a downtrend in the dominance of the market’s first currency would increase the bullish potential of the altcoin sector.
The tokenomics of the project will not likely affect performance in the short term, but will come into play with its dynamics most likely as summer approaches.
Let’s expect another 3-4 months of excitement for the Celestia cryptocurrency and its cryptographic ecosystem.
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