According to on-chain data provider Lookonchain, a whale, or large holder, has moved 15,000 ETH worth $25.16 million from the Seychelles-based OKX crypto exchange.
The whale deposited a portion of its withdrawals — roughly 10,150 ETH worth $17 million — into DeFi via the protocols Compound and Aave. He or she then borrowed $10 million in USDC stablecoin, which was transferred to Circle.
A whale withdrew 15,000 $ETH($25.16M) from #OKX and deposit 10,150 $ETH($17M) to #Compound and #Aave.— Lookonchain (@lookonchain) February 21, 2023
Then borrowed 10M $USDC and transferred to #Circle.https://t.co/64nfx2nBHD pic.twitter.com/PvWczZ45xp
Although the whale's actions may have been made for a variety of reasons, one particular motive may have been to avoid the current market fluctuations while still wanting to keep the particular cryptocurrency for a lot longer.
At the time of publication, ETH was down 1.87% at $1,682.
Analysts suggest that the withdrawal of cryptocurrencies from exchanges to put in cold storage for safety or into DeFi to generate yield may indicate that investors are prepared to hold onto their cryptocurrency for a long time.
Users deposit digital assets into the "liquidity pools" of DeFi protocols, which become funds that could be lent out.
This often stems from a belief that the market could rise even further. Also, the whale was able to access liquidity by borrowing 10 million USDC stablecoin without having to sell his assets.
Arbitrage, which involves buying an asset in one market and selling it right away in another market for a greater price, is one of the most obvious justifications for borrowing.
Since the beginning of the year, ETH, the native token of Ethereum, has increased by more than 40%, reaching its highest point in seven months at almost $1,750.
According to on-chain analytics firm Santiment, the Ethereum price increase follows the determination of shark and whale addresses that have accumulated 1.88 million ETH since November 2022.