The recent launch of the Bitcoin ETF has seen a positive impact on the Ethereum price. However, the movement of ETH holdings by Celsius Network, a bankrupt crypto lender, has raised concerns about potential destabilization. On-chain data analyzed by crypto market intelligence company Arkham Intelligence reveals that Celsius Network transferred over $125 million worth of ETH to various crypto exchanges last week. The company executed transfers worth $95.5 million to Coinbase and $29.73 million to FalconX between January 8 and January 12. Currently, Celsius Network holds 584,601 ETH worth $1.47 billion, along with other cryptocurrencies like BTC and CEL tokens.
The transfers made by Celsius Network into crypto exchanges strongly suggest an intent to sell off their ETH holdings. This aligns with the company’s ongoing efforts to fulfill its liabilities under bankruptcy proceedings. Celsius filed for bankruptcy in July 2022, following the collapse of TerraUSD and the LUNA ecosystem. This unfortunate situation left creditors with their funds trapped on the platform for the past 18 months. However, despite its bankruptcy status, Celsius has been actively making moves to refund its creditors. In December 2023, the company sold $240 million worth of ETH, and it recently announced its plan to unstake $465 million worth of Ethereum for distribution to its creditors.
While Ethereum has been enjoying a 13% gain in the past seven days, significant selloffs like the one conducted by Celsius Network can shake market confidence and trigger sell-offs from other investors. However, some analysts believe that Ethereum’s resilience can counteract any potential negative effects. Interestingly, Ethereum maintained its bullish sentiment during the time of these transfers, with its price surging 23% from $2,191 on January 8 to $2,706 on January 12. Although Ethereum has experienced a decline since then, now trading at $2,514, there is still a risk of further price impact. Coinglass reported $23.84 million worth of ETH positions liquidated in the past 24 hours. The continuous selling off of assets by Celsius Network, including ETH, BTC, MATIC, and LINK, could exert more downward pressure, especially as Ethereum tests the support level of $2,500.
In addition to Celsius Network, other actors were observed transferring ETH during the week. On-chain data from Spotonchain revealed that FTX and Alameda Research moved 1,000 ETH worth $2.33 million to Coinbase. These additional transfers, although smaller in scale, contribute to the overall potential impact on the Ethereum price. It is worth noting that despite the recent transfers, Celsius Network still retains significant cryptocurrency assets, including ETH and BTC. However, if the company continues to sell off these assets, it could have a more substantial effect on Ethereum’s price.
The recent transfers of ETH by Celsius Network to various crypto exchanges have raised concerns about the stability of the Ethereum price. With the company actively fulfilling its liabilities under bankruptcy proceedings, the motive behind these transfers appears to be a planned sell-off. While Ethereum has demonstrated resilience in the face of such events, continued asset liquidation by Celsius Network and other actors could further impact the price. Investors and market participants should closely monitor these developments and conduct thorough research before making any investment decisions.
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