Large cryptocurrency holders sell millions of a token that is being targeted by the SEC
Five major holders of Lido (LDO) tokens recently offloaded nearly $8 million worth of assets following an enforcement action by the Securities and Exchange Commission (SEC). This move involved transferring 4.44 million LDO tokens to a Binance address, resulting in losses exceeding $2.6 million.
According to a report from SpotOnChain, these five addresses belong to three distinct and well-capitalized investors. Notably, these whales executed their transactions almost simultaneously, albeit with minor timing discrepancies.
Detailing their activities, the first entity, identified as ‘Whale 0xd7c,’ deposited its remaining balance of 927,834 LDO tokens, valued at approximately $1.68 million. This particular whale had initially purchased 2.428 million LDO tokens on May 30 for $5.64 million, equating to $2.324 per token. Over the past two days, it liquidated its holdings at an average price of $1.923 per token, resulting in total proceeds of $4.57 million but incurring losses amounting to $973,000.
Another set of addresses, 0x287 and 0x7Ee, are believed to be under the control of the same entity. This collective, referred to as ‘Whale 0x287+0x287,’ deposited its entire 2.26 million LDO holdings valued at $4 million, facing an estimated loss of $1 million within a month of its initial investment. The tokens were withdrawn from Binance at an average price of $2.217, costing around $5.01 million across transactions made on May 24 and June 23, 2024.
Addresses 0xBD0 and 0x423 jointly liquidated all their 1.25 million LDO tokens, valued at $2.23 million, also after holding them for approximately a month. These tokens were withdrawn from Binance at an average price of $2.289, with total transactions amounting to $2.87 million between May 24 and June 23, 2024. This move resulted in estimated losses of $643,000.
The SEC’s recent legal actions, particularly targeting Consensys over its MetaMask Ethereum staking service on June 28, have raised concerns in the cryptocurrency market. The lawsuit specifically mentioned Lido and Rocket Pool as running illegal operations. This regulatory uncertainty has cast a shadow of doubt over the Lido protocol, potentially impacting the confidence of these whales and their investments in the LDO token.
Currently, LDO is trading at $1.73, marking a 24% decline over the past seven days, largely attributed to the fallout from the SEC lawsuit against Consensys.
Investors are advised to exercise caution when engaging with the Lido platform and trading LDO tokens, particularly amidst the prevailing regulatory uncertainties.
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