Today, the crypto market has seen a panic-like decline due to the expectation of a global economic recession. The price of Bitcoin (BTC) has plummeted from $60,000 to below $50,000 in just two days, and Ethereum (ETH) has fallen from over $3,000 to a low of nearly $2,100. Despite the many unfavorable factors in the global macroeconomic situation, the cryptocurrency market's plunge today was mainly attributed to the massive sell-off by the well-known cryptocurrency institution Jump Trading.
Jump Trading has dramatically sold off hundreds of millions of dollars worth of Ethereum in a week while facing an investigation by the U.S. Commodity Futures Trading Commission (CFTC). The crypto market is already on edge, and rumors that Jump Trading's crypto business may be shutting down have exacerbated the market's panic.
So how many tokens did Jump Trading sell, and how many tokens does Duo Shao still hold?
Jump Sell-off Details
Jump Trading’s series of unusual trading activities began on July 26, when 7,000 Ethereum (ETH) worth approximately $22.6 million was transferred in a large transaction. This operation coincided with the market volatility after ETH dropped sharply from 3,500 USDT to 3,100 USDT.
In the following two days, Jump Trading initiated its first round of selling, transferring 4,737 ETH to Binance with an estimated market value of approximately $15.4 million.
In the following days, Jump Trading conducted multiple fund collection operations, including unstaking ETH in Lido, transferring funds from other wallets, and depositing these funds into exchanges. In particular, the 120,000 wstETH (wrapped staked Ethereum) held by Jump Trading was redeemed in large quantities starting from July 25.
To date, Jump Trading still holds about 37,000 wstETH, with a market value of about $100 million, and has $8 million worth of RETH (Rocket Pool Eth). All redeemed portions have been transferred or sold. This series of actions has attracted widespread attention in the market, and market analysts continue to closely monitor it.
Remaining positions
This morning, multiple on-chain analysis teams reported that 96% of Jump Trading’s tokens are stablecoins, which are not actually included in the above address holding $100 million in wstETH.
The current holdings of the Arkham-marked Jump Trading address are worth $590 million, of which $569 million are stablecoins, so the apparent selling pressure is more than $100 million in ETH.
However, as the industry leader, Jump Trading’s theoretical holdings should be far more than $600 million. At its peak, an old address of Jump Trading held 1.64 million ETH, which was worth as much as $3.77 billion at a price of 2,300 USDT.
However, since Jump Trading transferred more than one million ETH to Robinhood in May and June 2023, it is currently impossible to track whether they were sold or transferred, and the potential magnitude of the selling pressure cannot be estimated, but it is worth paying attention to.
Jump to exit crypto?
Why did Jump start selling ETH so quickly? There is no public conclusion yet, but the market speculates that this move is related to the previous CFTC investigation. On June 20, according to a market news, the U.S. Commodity Futures Trading Commission (CFTC) is investigating Jump Crypto, but it is not clear whether the CFTC is considering any charges against the company. Four days later, Jump Crypto President Kanav Kariya announced his resignation on the X platform.
During Jump’s ETH sell-off, Justin d’Anethan, head of business development for Asia Pacific at cryptocurrency market maker Keyrock, said: “There are rumors that they (Jump Trading) may be forced to exit the crypto business due to the CFTC investigation.”
After the sharp drop this morning, BitMEX co-founder Arthur Hayes posted on X that he learned through traditional financial sources that a "big shot" was disposed of and sold all crypto assets. He added that he was not sure whether the news was true, but would not disclose the specific name. Based on various signs, the community speculated that he was referring to Jump Crypto.
