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Lookonchain has spotted an unusual transfer in the Ethereum ecosystem that has sparked widespread speculation on the market. The on-chain analytics platform highlighted that an Ethereum (ETH) wallet, which has been dormant for nine years, was suddenly reactivated and has made some major transactions.
Unusual capital rotation to Bitcoin Cash
Notably, the wallet, which is possibly linked to Erik Voorhees, CEO of ShapeShift exchange, has been busy over the last 14 days.
Since it became active, the wallet has sold a total of 4,619 ETH, valued at about $13.42 million. This large volume has caught the attention of the Ethereum community, given the asset’s price performance lately.
More concerning, however, is that Voorhees has used the proceeds from the sales to buy Bitcoin Cash (BCH). So far, 24,950 BCH has been purchased within the period. The capital rotation from a dormant wallet that suddenly became active has triggered speculation among users online.
Undoubtedly, Voorhees is an early adopter of Ethereum, and many wondered what could have caused him to dump ETH for BCH. If the wallet actually belongs to Voorhees, likely, he is no longer convinced of Ethereum’s long-term growth trajectory.
It is worth mentioning that when these 4,619 ETH were acquired in 2016, the asset’s highest price peak was around $20. This places the total value of the asset below $100,000 and leaves Voorhees with a profit of over $13.3 million.
Some traders consider the move as bullish for Bitcoin Cash but cautionary for Ethereum. In the last 30 days, Ethereum’s volatility has prevented it from gaining stability above the $3,000 level. The coin has faced rejection at $3,400 and $3,200 within this time frame.
As of press time, Ethereum is changing hands at $2,947.82, which represents a 2.34% decline in 24 hours. It had briefly flipped the $3,000 resistance to hit $3,025.82 before suffering a correction in the course of the day’s trading.
Is Ethereum witnessing systemic dump?
Meanwhile, some community members have dismissed the capital rotation by this wallet from Ethereum to Bitcoin Cash as an isolated case. They maintain that this alone should not spark a volatility narrative for the leading altcoin.
However, as U.Today reported, Samson Mow, CEO of JAN3, within the last 24 hours, has also liquidated all Bitmine Ethereum holdings and pivoted to Bitcoin. Mow had previously diversified his portfolio and bet on Ethereum as a treasury asset.
Market analysts are keenly watching to see how this impacts Ethereum and if it might trigger panic selling on an already volatile market.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team