LAB rebounded from a low near $5.68 earlier in July and rallied to a high of $18.32. After reaching that level, the altcoin faced rejection and entered a steep decline.
The altcoin then recorded three consecutive lower daily closes and briefly fell below $1.
At press time, LAB traded around $1.17 after gaining roughly 25% over the past day. Market Cap also climbed about 25% to nearly $366 million.
However, the recovery came with an important caveat.
Trading Volume fell more than 40% despite the price rally, indicating buying activity weakened even as LAB recovered. That divergence suggested the rebound may not have been driven by broad market demand.
Why did LAB rebound?
AMBCrypto attributed the rebound to a deflationary move by the LAB team rather than stronger organic demand.
Source: Lookonchain
The team burned 10 million LAB, worth about $11.3 million, as the token remained under heavy selling pressure. Reducing the circulating supply appeared to ease immediate selling pressure and helped LAB recover above $1.
Historically, token burns have often supported short-term price recoveries. LAB appeared to follow the same pattern.
Can token burns offset upcoming unlocks?
Even so, the broader supply picture remained less encouraging.
Blockchain investigator ZachXBT previously claimed insiders controlled roughly 95% of the altcoin supply, giving a small group significant market influence.
Source: ZachXBT
ZachXBT also alleged that the borrower address linked to the LAB contract was used for token buybacks, suggesting the team managed buybacks, burns, and token sales.
However, larger supply increases may soon outweigh the recent burn.
According to Tokenomist, 14.8 million LAB, worth about $15.4 million, from the airdrop allocation will unlock soon.
Source: Tokenomist
Investor allocations will release another 31.5 million LAB, valued at roughly $33 million.
Together, 46.3 million LAB could enter circulation within days, potentially diluting the impact of the recent burn.
What’s next for the altcoin?
Despite the rebound, the broader trend remained bearish.
The MACD stayed deep in negative territory at -2.2, showing sellers continued to dominate momentum.
If buying interest weakens after the token burn, LAB could fall below $1 again. Conversely, sustained demand would be needed to absorb the upcoming token unlocks and keep the recovery intact.
Source: Tradingview
Final Summary
- Burning tokens reduced pressure. Upcoming unlocks could restore it just as quickly.
- LAB recovered above $1, but dilution risks remained difficult to ignore.
