Jump Trading Resumes Selling Spree, Sparking Manipulation Fears in Ethereum Community

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Following its recent controversial selloff, Jump Trading has moved another $46.44 million worth of Ether tokens. This substantial fund transfer has sparked potential market manipulation and selloff pressure concerns. However, on-chain data suggests it’s a strategic liquidity setup. 

Jump Trading Resumes Selloff

An August 14 report from on-chain tracker Lookonchain revealed that Chicago-based proprietary trading firm Jump Trading moved 17,049 ETH worth around $46.44 million.

Jump Trading is selling 120,695 $wstETH($481M) and has sold 83K $wstETH($377M) since July 24, leaving 37,604 $wstETH($104M).

The market also began to fall after July 24, falling by more than 33%!

According to reports on June 20, the US #CFTC is investigating Jump Trading.… pic.twitter.com/pOoGZknUDh

— Lookonchain (@lookonchain) August 5, 2024

Lookonchain revealed that the firm claimed the Ether tokens from the liquid staking platform Lido and transferred them out for sale. 

After the latest transfer, Jump Trading now has 21,394 ETH worth about $68.58 million as the balance of its Ethereum holdings. The recent move is reportedly part of Jump Trading’s preparation for an anticipated selloff. 

According to Lookonchain, a wallet address linked to Jump Trading initiated an ETH withdrawal on Lido at 7:47 am UTC on August 14. 

Etherscan data shows this wallet last initiated transactions on August 9 at 3:09 pm UTC and remained dormant until the recent move. The transaction pattern suggests Jump Trading is selling off its Ethereum holdings in batches. 

Market Manipulation and Selloff Concerns

Lookonchain’s report says the firm transferred the tokens for sale, raising concerns about a potential selloff pressure on Ethereum. However, on-chain data tracker Arkham Intelligence and some community responses paint a different picture. 

Responding to the report, an X user said Jump Trading had moved the Ether tokens back to its account. Another X user expressed concerns about potential market manipulation, saying the trading firm wants to buy more.

Transferred back to their account! pic.twitter.com/BRWhYMwT9W

— Dalio (@Dalio777) August 14, 2024

Meanwhile, data from Arkham Intelligence shows that Jump Trading deposited 137.33 Ether valued at $375,600 to Binance, 223,724 USDC to Bybit, 92,692 Tether to Gate.io, and 67,668 USDC to Coinbase. 

Contrary to Lookonchain’s selloff narrative, these transfers suggest the firm might be raising liquidity for trading activities across multiple exchanges. 

Jump Trading Selling Spree to Trigger Market Downturn?

Amid the recent market-wide downturn, Jump Trading’s crypto division, Jump Crypto, moved millions of dollars in cryptocurrencies for sale on various exchanges. 

According to Lookonchain’s August 5 X post, the firm has sold $377 million in Wrapped Lido-staked ETH (wstETH) since July 24. This massive token dump triggered an over 33% decline in the price of Ethereum after July 24. 

Between August 4 and 8, the crypto asset holdings of wallets linked to Jump Trading dropped by approximately $247 million. Further, Lookonchain revealed that Jump Trading still plans to sell more and could dump 120,695 wstETH worth $481 million.

In addition, QCP Group’s August 5 report blamed Paradigm VC and Jump Trading’s aggressive Ether Selloff for Ethereum’s crash to a five-month low. 

According to reports, the US Commodities and Futures Trading Commission (CFTC) is intensely scrutinizing Jump Trading.