Embattled Crypto Lending Platform Celsius Network Sells $125 Million Worth of Ethereum
Celsius Network, a crypto lending platform facing financial difficulties, has sold over $125 million worth of its Ethereum (ETH) reserves in an effort to repay creditors as part of its bankruptcy proceedings. This significant ETH sell-off, coupled with record-high levels of staked Ethereum redemptions totaling over $1.6 billion in the same period, has put selling pressure on Ethereum and caused its price to decline.
TLDR
- Celsius Network sells over $125 million of Ethereum (ETH) to repay creditors during bankruptcy proceedings
- Over $1.6 billion worth of staked Ethereum is redeemed in the same period, the highest amount since the Shanghai upgrade
- Celsius still holds substantial Ethereum reserves of over 557,000 ETH worth around $1.3 billion
- The selling of ETH by Celsius adds pressure on Ethereum’s price, resulting in a 4% decline below $2,350
- Wealthy investor selling often triggers further ETH selling by regular holders, intensifying price declines
Despite the sales, Celsius still holds significant Ethereum reserves in two staking wallets, with over 557,000 ETH worth approximately $1.3 billion. However, the platform continues to auction off its crypto assets to fulfill debt obligations required by the courts. While necessary for bankruptcy proceedings, this selling has significantly contributed to bearish momentum on Ethereum’s price.
Between January 8-12, Celsius made a series of large transactions involving Ethereum. They offloaded over $125 million worth of ETH during this period. Additionally, blockchain analytics firms detected two more substantial transfers: a 13,000 ETH deposit ($30 million) to Coinbase and 2,200 ETH ($5 million) to FalconX.
These transactions indicate an aggressive approach by Celsius in raising capital to address creditor obligations. However, the resulting selling pressure exceeded Ethereum’s capacity, leading to a 4% decline below the $2,350 level. The moves also pushed ETH below a critical demand zone between $2,380 and $2,461, causing concerns of further price slides.
In addition to Celsius’ activities, there were significant Ethereum redemptions, totaling over $1.6 billion worth of staked Ether during the Celsius crisis. This set a new record high for the year so far. Combined with Celsius’ sales, it created unfavorable market conditions that prompted analysts to predict a retest of the $2,000 zone for ETH.
Data from Santiment suggests that sell-offs by whales and wealthy investors often trigger profit-taking by regular ETH holders, intensifying downward momentum during bear cycles. However, decreasing funding rates provide some optimism that markets can stabilize and Ethereum can rebound if selling pressure subsides. Nevertheless, the crypto community remains cautious about how Celsius’ broader troubles could continue to impact Ethereum.
Hot Take: Selling Pressure on Ethereum Intensifies as Celsius Network Offloads ETH Reserves
Celsius Network’s recent sale of over $125 million worth of Ethereum (ETH) has added significant selling pressure on the cryptocurrency. This, combined with record-high levels of staked Ethereum redemptions, has caused Ethereum’s price to decline. Despite holding substantial reserves of over 557,000 ETH worth around $1.3 billion, Celsius continues to auction off its crypto assets as part of bankruptcy proceedings. The aggressive selling by Celsius has not only affected Ethereum’s price but also triggered further selling by regular holders. As a result, analysts are concerned about further price declines and a potential retest of the $2,000 zone for ETH. The crypto community is closely monitoring the situation to see how Celsius’ troubles will impact Ethereum moving forward.
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