A smart Ethereum investor, identified in cryptocurrency technical jargon as a “whale,” has transferred a whopping 39,260 ETH from a private address to Kraken after being inactive for about 5 years.
Most likely, the large sum, equivalent to about 90 million dollars, will be sold for dollars or exchanged for other tokens on the exchange.
The ETH in question had been purchased by the anonymous user between June and August 2017 for a total value of approximately 9 million dollars.
The investment in Ethereum has therefore grown approximately 10 times, leading to a stellar profit that could now be realized several years later.
The presumed sale should not have a significant impact on the price of ETH.
Let’s see all the details below.
Summary
Sleeping Ethereum whale wakes up and prepares to liquidate 90 million dollars in ETH on Kraken
A Ethereum whale who made significant purchases in 2017 before the major cryptocurrency bull run, transferred a sum of 39,260 ETH to the Kraken exchange this morning, equivalent to precisely 86.6 million dollars.
Usually when you deposit coins on exchange platforms, you do it to switch to sales being able to take advantage of greater liquidity, lower slippage, and more convenient fees.
The million-dollar amount in Ethereum should therefore be sold for FIAT or exchanged for Bitcoin or other tokens.
The subject in question had stocked up on decentralized currency between June 30th and August 12th, 2017, managing to acquire a total of 47,260 ETH on the Phemex exchange, and then transferring them to another address in October.
At the time, the price of Ethereum was moving within a trading range between 167 and 310 dollars per unit.
Now, after about 5 years of inactivity, the smart whale that has patiently held its position could realize a profit of about $74.5 million with the presumed sale on Kraken.
According to the on-chain analysis company Arkham, the address belongs to Cumberland, a trading company founded in 2014 that leverages technology, research, and risk management to help institutions take advantage of cryptocurrency market opportunities.
However, the early investor, despite the great profit, has also made some mistakes in the past.
By going through the transactions recorded by the Ethereum blockchain, we can see how the missing 8,000 ETH, purchased in 2017, were transferred to an unidentified address on September 15, 2018, when the price of ETH had returned to $220 after reaching a peak of $1,440.
In addition, a wallet connected to that of the whale purchased an additional 4,808 ETH on September 29, 2021 when the price of the crypto was above $3,330 for a total amount of $13.7 million.
Now the sum, transferred to March 2023 to another address but not yet sold, amounts to 10.6 million dollars.
Most likely, if Cumberland has the patience as demonstrated in the last 5 years, it will also be able to return to profit given the optimistic forecasts for the price of ether in the next year.
Impact of alleged sales on the price of ETH
As already mentioned, the transfer of Ethereum whale to Kraken is likely motivated by the intention to sell ETH for FIAT or to exchange the asset with other cryptographic tokens.
Considering the average volumes recorded on Kraken, it can be inferred that, mathematically speaking, the sale of the sum amounting to 86.6 million dollars today could impact the price of ETH by at least 2%.
However, it should be considered that in a widely spread international market like Ethereum, the high presence of bots that level the price spread across multiple markets could minimize the impact on the price.
In addition, the same whale, identified by Akrham as Cumrberland, could sell the 39,260 ETH deposited on Kraken in tranches by selecting price areas where there is greater liquidity, rather than opting for a single large market order.
It is also in the interest of the subject to maximize the amount of the settlement, without causing heavy drops in the price of Ethereum.
Many might think that this is negative news for the crypto market in general as a big investor who has held for 5 years is selling a large part of their treasure.
In reality, analyzing the situation more closely, we can infer that it is unlikely that ETH will be sold for dollars while it is more feasible that they will be converted into BTC, taking advantage of the current strength of the currency.
The king of the market is indeed increasing its dominance and showing a hotter momentum compared to Ethereum.
The ETH-BTC chart is representative of this situation: on a weekly time frame.
the slight downtrend that started in August of this year is about to accelerate its bearish trajectory, with a target of 0.003.
The motive behind Cumberland’s transfer to Kraken could be a temporary switch from Ethereum to Bitcoin, and then convert the amount back as soon as ETH shows more strength compared to the number one cryptocurrency in the industry.
Contrary to what one might imagine, the whale’s intentions could be to accumulate ETH.
