ETH Price Falls 20% as Trading Firm Shifts $46M to Centralized Exchanges

Major Move by Jump Trading Triggers Ether’s 20% Plunge

In a significant market shift, Ether (ETH) has plummeted by 20% as one of the crypto world’s heavyweights, Jump Trading, moved substantial amounts of ETH to centralized exchanges. According to on-chain analysis by Spot On Chain, the firm transferred 17,576 ETH, valued at over $46 million, in preparation for a potential liquidation.

ETH Hits Seven-Month Low Amidst Massive Transfers

Ethereum’s native token, the second-largest cryptocurrency by market capitalization, experienced a drastic decline, hitting its lowest point since January. During the Asian trading hours on Monday, ETH fell below $2,100, marking a sharp 20% drop within a single day.

Spotlight on Jump Trading’s Activity

The significant movement of ETH was traced to a wallet linked to Chicago-based Jump Trading. This wallet has been active since late July, moving nearly 90,000 ETH to exchanges. As of now, it holds 37,600 wstETH (wrapped staked ETH) and 11,500 stETH (staked ETH).

The firm’s actions come amid reports of an ongoing investigation by the U.S. Commodity Futures Trading Commission (CFTC) into Jump Trading’s activities. This scrutiny, combined with the recent transfers, has fueled speculation and concern within the crypto community.

Possible Reasons Behind the Sell-Off

Dr. Julian Hosp, CEO and co-founder of the decentralized platform Cake Group, shared insights on the situation via social media platform X. He suggested two possible scenarios: Jump Trading might be facing margin calls in traditional markets and thus requiring liquidity, or the firm could be exiting the crypto market due to regulatory pressures, particularly in light of issues related to the Terra Luna collapse.

Market Reaction and Community Response

The timing of these large-scale liquidations has drawn criticism from the crypto community, given the typically low liquidity during weekends and early Monday hours, which exacerbates market volatility. This period is often marked by a reduced ability to absorb large orders without significant price impacts.

Also Read: Ethereum ETFs Experience $133M in Withdrawals, Triggering Price Drop