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U.S. Govt Moves ETH Worth $700K: Another Sell-off Panic?

U.S. Govt Moves ETH Worth $700K: Another Sell-off Panic?

DailycoinDailycoin2024/08/06 18:09
By:Dailycoin
  • The U.S. government has moved part of its Ethereum holdings.
  • The asset transfer has ruffled feathers amid a weekend market crash.
  • Despite concerns, Ethereum is already showing signs of a rebound.

The past weekend has been tough on all crypto market participants, but Ethereum (ETH) holders have been especially worst hit. In addition to worrying macroeconomic dynamics that have sent perceived risk assets tumbling, the asset has faced selling pressure from Jump Crypto and now the U.S. government.

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Over the past 24 hours, a government-controlled wallet has sparked speculation of a sell-off by moving a substantial amount of ETH to an exchange. Is another sell-off looming?

U.S. Govt Makes Ethereum Move

Over the past 24 hours, the U.S. government gave Ethereum holders another reason to be concerned. On August 5, the government moved 300 ETH worth approximately $700,000, which it seized in a May 2024 case, to Bybit in two transactions , the first being a test transaction of 0.041 ETH worth about $97.

The remaining 299.956 ETH was subsequently transferred to the same address: 0x38cEd5767F1c16DeeA54c5175e0f23a5DAb1aD46.

— Wu Blockchain (@WuBlockchain) August 5, 2024

The transactions raised concerns as many feared how another sell-off could impact the asset amid a global market meltdown and Jump Crypto selling that had already seen it tank by over 30% to at one point around the $2,100 price point, erasing all of its 2024 gains.

Despite the prevailing concerns, there may be no need to panic. 

A Drop in the Ocean?

As highlighted by prominent crypto community member “WazzCrypto,” the ETH moved on Monday from a single case in May 2024, offering no indication that the government would likely dump the remainder of its ETH holdings. 

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At the same time, the U.S. government’s remaining ETH stash, about 50,500 ETH worth nearly $120 million, is minuscule compared to the volume of ETH traded daily, suggesting the market can easily absorb the impact. For context, ETH boasts a trading volume of about $39 billion in the past 24 hours, per CoinMarketCap data at the time of writing.

Meanwhile, Ethereum is already showing signs of a recovery as the dust settles on the weekend panic. At the time of writing, the asset has pared some of its losses to trade above the $2,400 level, representing an 8% increase over the past 24 hours.

Analysts like prominent crypto trader “CJ” have suggested that ETH’s price will likely range after the sharp weekend decline before its next major swing.

On the Flipside

  • How the U.S. would dispose of its remaining ETH stash remains to be seen.
  • Despite the U.S. government selling concerns, Ethereum’s price remains steady at the time of writing.

Why This Matters

Ethereum was the worst-hit crypto asset among the top 20 by market capitalization in the recent market crash. Selling from the U.S. government, combined with the worrying macroeconomic backdrop, raises questions about a continued price dump.

Read this for more on Ethereum:
Ethereum’s Vitalik Gets Flak for L2 Interoperability Post Amid Market Panic

See how Polygon fared in the recent market crash:
Polygon’s MATIC Tanks to Over 2-Year Lows as Fear Grips the Crypto Market

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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