According to data from on-chain transaction tracker Lookonchain, the ethereum Foundation recently made a significant move by depositing 35,000 eth, valued at $94.07 million, into cryptocurrency exchange Kraken. This major transaction has raised concerns in the ethereum investor community, particularly since it occurred. During a small rally in the cryptocurrency market As the week came to a close.
The timing and magnitude of the transfer have sparked speculation among investors, who are wary of its potential. Impact on ethereum price and overall market stability. In response to these concerns, Aya Miyaguchi, director of the ethereum Foundation, clarified that the transfer was part of the foundation’s routine treasury activities.
He stressed that such transactions are necessary to maintain the foundation's operations and should not be interpreted as a sign of any negative outlook on the market or the future of ethereum.
Analyzing the transfer of 35,000 eth
The ethereum Foundation wallet is one of the largest holders of ethereum. As such, transfers from the wallet are closely monitored by market participants. Due to the nature of checks and balances, large transactions in the wallet are usually reported in advance by the ethereum Foundation. However, this was not the case in the recent transfer of 35,000 eth to Kraken.
After the transaction was revealed on social media platform x by Lookonchain, it generated some comments from investors. An ethereum softcore developer, known as antiprosynthesis.eth on the platform, x.com/antiprosynth/status/1827051522208768006″ target=”_blank” rel=”noopener nofollow”>expressed his concerns wondering why such an important transaction could take place “without even a sound.”
In response, Aya Miyaguchi, director of the ethereum Foundation, provided some context. She explained that the foundation operates on an annual budget of approximately $100 million and that many of the recipients of these funds require payments in fiat currency.
This need prompted the conversion of eth to fiat, which led to the transfer to Kraken. This, in turn, confirmed that the transfer was indeed done with a view to selling eth tokens. However, it clarified that the transfer was not a direct sale and that planned and gradual sales would be made from now on.
As to why the community was not notified before the sale, the director said the foundation was advised not to undertake any treasury activities due to regulatory complications. Therefore, they were unable to share the plan in advance.
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This is part of our treasury management activities. EF has a budget of ~$100M per year, which is largely made up of grants and salaries, and some of the grantees can only accept fiat money. This year, there was a long period of time when we were advised not to do anything…
— Aya Miyaguchi (ayamiya.eth) (@AyaMiyagotchi) twitter.com/AyaMiyagotchi/status/1827219654999470258?ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank”>August 24, 2024
Current state of ethereum
At the time of writing, ethereum is trading at $2750. After a few days of bullish action, the cryptocurrency seems to haveethereum/ethereum-analyst-bulls-must-hold-2500-spot-etf-to-catalyze-demand/” target=”_blank” rel=”noopener nofollow”> created support around $2,730. According to EtherscanCurrently, the ethereum Foundation wallet holds 273,273 eth worth $752 million. In total, the wallet holds $769 million in multiple tokens.
The ethereum Foundation is not the only significant transfer to a cryptocurrency exchange in recent days. Whale Alerts ethereum-transfer-sparks-shock-at-leading-us-exchange/” target=”_blank” rel=”noopener nofollow”>took note of a recent transfer of 300,000 eth on Coinbase.
Featured image from The US Sun, chart from TradingView
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