2 whales, often referred to as big players, have borrowed 8,400 $ETH, which is worth $25 million, from a decentralized crypto lending platform called Aave. The whales have transferred the borrowed money to Binance, which is one of the most popular centralized cryptocurrency exchanges. It is believed that they are shorting $ETH. Shorting is a trading strategy in which an investor bets on a decrease in the price of a cryptocurrency. From now, if the price indeed falls, the investors will earn money.
2 whales have borrowed 8,400 $ETH($25M) from #Aave and deposited it into #Binance in the past 2 hours.Probably shorting $ETH.Address:https://t.co/uuURQrYUmuhttps://t.co/TdnOyMHxX3 pic.twitter.com/q164hKbu4O
— Lookonchain (@lookonchain) May 13, 2024
Whales Tap Aave for $ETH Loan in Crypto Market Move
The whales loaned $ETH from Aave, a decentralized platform where people can lend and borrow crypto. Aave is powered by a system of collateral, a feature that obliges users to stake assets before borrowing, and has an inbuilt cryptocurrency token, AAVE.
Aave enables essential functions, including providing liquidity pools and facilitating flash loans. However, it also has risks such as the high potential for liquidation and being exposed to the crypto market.
Upcoming Economic Reports Fuel Interest in Shorting $ETH
Future economic data is soon to be released which would affect the decision to short $ETH. In the next few days, data is going to be released from the Federal Consumer Price Index and Producer Price Index.
These two reports will undoubtedly make the market more volatile and shorting $ETH could be a more profitable strategy. Another major and free acceleration of short $ETH is the impact of an extremely unfair decision on our side is an Ethereum Exchange Traded Fund.