How Will ETH Price Be Affected by Ethereum Foundation’s Transfer of $30 Million Worth of ETH to Kraken?
Ethereum Foundation has transferred a total of 30 million USD worth of ETH to the Kraken exchange. This transfer of 15,200 ETH from the foundation’s wallet, along with 200 ETH from Vitalik Buterin’s wallet, was completed on May 6, 2023.
After vitalik.eth transferred 200 $ETH($396K) to #Kraken, ETH Foundation also transferred 15,000 $ETH($29.7M) to #Kraken.https://t.co/FPVeH3Z8sJhttps://t.co/AHALnpKtxd pic.twitter.com/iLIHghJUIX
— Lookonchain (@lookonchain) May 6, 2023
The purpose of this transaction is unclear, but looking back at the foundation’s history of similar transactions, it appears that the foundation may be selling off a portion of its holdings for various operational expenses, marketing, and other activities.
What’s interesting to note is that in the past, every time the foundation has transferred a large amount of ETH to an exchange, the price of ETH has seen a significant drop in the following days. For example, in March 2021, the foundation transferred 28,000 ETH to Kraken, and the price started to decline within a week. Similarly, in May of the same year, the transfer of 35,000 ETH caused an immediate drop in the price of ETH.
The most recent and largest sell-off occurred in November 2021, when the Ethereum Foundation transferred 20,000 ETH to Kraken, causing the price of ETH to drop from its peak of 4,800 USD to around 4,300 USD.
As for the current price of ETH, it has not fluctuated much in the past 24 hours and is currently hovering around 1,967 USD.
It’s important to note that these transactions are not unusual as most tokenomics models have a certain percentage of tokens reserved for operational costs. However, it’s worth keeping an eye on the market to see if the recent transfer will have any impact on the price of ETH in the coming days.
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