Crypto
Dormant Ethereum Wallet Awakens After Three Years, $42.4 Million Worth of ETH Moved
courtesy of bitcoinist.com
Background
A dormant Ethereum (ETH) wallet that had been inactive for nearly three years has suddenly become active again. The wallet, which collected thousands of coins during the network's token generation event in 2014, recently moved a total of $42.4 million worth of ETH, with 10 ETH being deposited directly to the crypto exchange Kraken.
Early Acquisition
The dormant wallet initially acquired 100,000 ETH during the 2014 Ethereum initial token offering for a value of around $31,000. At the time, the price of ETH was just $0.31. Since then, the value of ETH has skyrocketed, reaching all-time highs in 2021.
Unusual Inactivity
Despite being one of the earliest ETH holders, the wallet had remained inactive and did not cash out during the 2021 bull run when ETH prices soared to as high as $4,800. The last time the wallet moved any coins was in 2020 when it transferred 0.70 ETH. However, prior to that, in 2019, the wallet had moved a total of 40,000 ETH.
Possible Liquidation?
When a whale, or a holder of a significant amount of coins, moves their assets to a centralized exchange like Kraken, it often suggests that they may be looking to liquidate and cash out for fiat currency or another digital asset like Bitcoin (BTC). This type of transfer is typically interpreted as bearish and can impact market sentiment.
Remaining Optimistic
Despite the potential for liquidation, the fact that only 10 ETH, and not a larger amount like 20,000 ETH, was moved to Kraken suggests that ETH bulls and traders are likely to remain optimistic. It is still unclear whether the coins were sold or not.
Establishing Liquidity Pathways
While the coins may be sold, it is important to note that the transfer of ETH to an exchange does not necessarily indicate an intention to sell. In some cases, the whale may be setting up liquidity pathways in preparation for favorable exit opportunities. Whales and institutions often spread their holdings across multiple platforms as part of risk management.
Current Price Action
As of now, Ethereum prices continue to rise, with the coin trading above $2,000. However, the market remains relatively volatile. Buyers need to build on the gains made on November 9 in order to see sustained upward momentum. If the bullish engulfing bar of November 9 pushes prices above $2,100 and registers fresh highs, ETH could potentially reach highs of around $3,500 in the near future.
courtesy of bitcoinist.com
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