Is Celsius’ Ethereum sell-off of $35M causing concerns about a potential crash in price?
Celsius Networks, despite facing financial difficulties and filing for bankruptcy, has made significant moves in the Ethereum space this week that have caught the attention of the digital currency world. In the past 10 hours alone, Celsius Networks has recorded substantial deposits, including 13,000 ETH ($30 million) on Coinbase and an additional 2,200 ETH ($5 million) on FalconX. These transactions, along with other significant Ethereum movements, demonstrate Celsius’s proactive approach to addressing its financial challenges.
Reports from Arkham Intelligence have revealed that Celsius has conducted extensive Ethereum sales, totaling over $125 million between January 8 and January 12. This strategic move aligns with the platform’s commitment to liquidating assets in order to meet financial obligations and satisfy creditor demands. At the same time, Dune Analytics has identified a noteworthy trend of Ethereum redemptions, surpassing $1.6 billion during the same period. This surge in redemption activity, the highest since last year’s Shanghai update, indicates a significant shift in the dynamics of the Ethereum market.
Despite the financial constraints caused by court proceedings, Celsius still maintains a significant Ethereum reserve. Two staking wallets owned by Celsius currently hold over 557,000 ETH, valued at approximately $1.3 billion. This further complicates the situation for Celsius.
In an attempt to satisfy creditors during the bankruptcy proceedings, Celsius is auctioning off its Ethereum holdings, which has led to a 4% decrease in Ethereum’s value. Analysts are concerned about breaching the $2,350 threshold, which is a crucial point within the demand zone of $2,380 to $2,461. If this level is breached, analysts anticipate a potential descent to $2,000 or even lower.
Santiment’s historical data introduces the concept of “whales,” significant players in the market who can trigger profit-taking activities. While this often results in market dips, decreasing funding rates suggest underlying optimism. This subtle shift indicates a possible cooldown in the perpetually overheated markets, raising hopes for Ethereum’s resurgence once selling pressures subside.