Ether Drops 20% Following $46M ETH Transfer by Trading Firm

August 05, 2024 03:45 PM AEST | By Team Kalkine Media

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Ether Drops 20% Following $46M ETH Transfer by Trading Firm — Image source: Shutterstock

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Headlines:

Ether Price Drop: Ether (ETH) fell by 20% within 24 hours, reaching a seven-month low of under $2,100 during Monday's Asian trading hours, following large transfers of ETH to centralized exchanges by a major trading firm.

Jump Trading's Moves: Chicago-based trading firm Jump Trading moved 17,576 ETH worth over $46 million to centralized exchanges within 24 hours, amidst reports of a CFTC investigation and having transferred nearly 90,000 ETH since late July.

Market Impact and Speculation: Dr. Julian Hosp of Cake Group speculated that Jump Trading might be liquidating due to margin calls or regulatory issues, with the timing of the sell-off during a period of weak market liquidity drawing criticism from the crypto community.

Ether (ETH) experienced a significant drop as a major crypto trading firm transferred large amounts of ETH to centralized exchanges, potentially preparing for liquidation. The price of Ethereum's native token, the second-largest cryptocurrency by market value, plummeted 20% in 24 hours, reaching a seven-month low of under $2,100 during Monday's Asian trading hours, according to CoinDesk data.

In the past 24 hours, a wallet linked to Chicago-based trading giant Jump Trading transferred 17,576 ETH, worth over $46 million, to centralized exchanges. This follows reports from June that Jump Trading is under investigation by the CFTC. Since July 25, the wallet has moved nearly 90,000 ETH to exchanges and still holds 37,600 wstETH and 11,500 stETH, with wstETH being the DeFi-compatible version of Lido's staked ether (stETH).

Dr. Julian Hosp, CEO and co-founder of decentralized platform Cake Group, suggested on X that the sell-off might be due to Jump Trading facing margin calls in traditional markets and needing liquidity or exiting the crypto business due to regulatory issues related to Terra Luna. The timing of the liquidation, over Sunday and early Monday, when market liquidity is typically weak, has drawn criticism from the crypto community.

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