The government of the United States has sent 300 ETHs from a state wallet address. The wallet in question was marked as funds seized from Noman Saleem. The details of the transfer were reported by on-chain analytics firm Arkham Intelligence.
The US Government Transfers $699,000 in ETH
The amount was valued at $699,000 and the wallet was called d46. The data indicated that the transfer was made on 5th August.
The analytics firm has confirmed that the total funds available in the wallet under question are nil. As per the reports on the matter, the ETH transfer took place after the bearish movement taking place in the spot market.
There have been some concerns among investors regarding ETH prices continuing to tumble despite the sudden approval of several Ethereum ETFs in the United States. Analyst Crypto Loin has mentioned that ETH prices struggled right after the ETF launch.
The analyst has attributed this price lag to the lack of demand for smart contract assets on exchange platforms. This lack of demand is also taking place at the same time when the traditional financial markets are in red on account of an unexpected interest rate increase decision by the Bank of Japan.
This phenomenon led to increased pressure on cryptocurrencies and decreased the price of Ethereum by several points.
Market Makers Induce ETH Selling Pressure
Market makers are another major contributor to ETH price liquidations. A total of 130 thousand ETHs were offloaded to circulatory supply. This amount accounted for $290 million leading the price of Ethereum to trade at $2100 as of 5th August 2024.
At the same time, ETH prices also dipped to the 200-day exponential moving average (EMA). CoinShares weekly inflow data on 5th August indicates that digital asset investment instruments reported the first capital outflow during the last 4 weeks.
Ethereum outflows accounted for $146 million in terms of investment products during the 7-day duration. In this manner, the total outflow for Ethereum ETF listed in the United States has reached $430 million.
CoinShares data projections also accounted for $603 million in outflows from Grayscale Ethereum Trust. The trust was founded in 2017. However, outflows have inclined for Grayscale Ethereum spot ETF filing taking place in July this year.
James Butterfill, analyst at CoinShares, noted that the ongoing downturn is stemming from macroeconomic factors. He also attributed the effect to ongoing geopolitical uncertainty. These conditions have created negative sentiment among crypto investors and created the possibility of a long-term recovery period for Ethereum.
Jump Trading
Ethereum price drop was also generated from massive sell-offs from ETH sales. This crash took place alongside the crash taking place in Japanese markets and raised many questions regarding the trading strategy and liquidation timing of Jump Trading. As on 5th August, the firm decided to offload hundreds of millions dollars worth of ETH.
This has also started debate among investors about the possibility of market manipulation and speculation. This aggressive liquidation was followed by a historic stock market crash on the same day.
Nikkei 225 Index dropped by 12.4% and lost 4451 points. This downturn was dubbed as largest ever in terms of points. Jump trading proceeded to move $315 million in the form of staked Ethereum to crypto trading platforms.
The biggest transfer took place over the weekend. Speculative forces are insinuating that these liquidations could be part of a sign of the firm winding down its crypto business.
Recently, the Jump CEO was prompted to resign following the investigation by the Commodity Futures Trading Commission of the United States. This liquidation was followed by BoJ raising the benchmark interest for the second time since March and the highest level in the last 15 years.
As a result, Yen value rose sharply against USD after reporting a 38-year low against USD in June. Steno Research senior analyst Mads Eberhardt posited that Jump trading could have been borrowing Yen to perform HFTs or leveraged positions. When the Yen value rose against USD, loan repayments became more difficult and many margin calls were activated.
