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Vitalik Buterin, cofounder of Ethereum, recently sold an astounding two trillion DOG tokens on Uniswap V4. The transaction, which is visible on the blockchain explorer, demonstrates that the tokens were delivered to his address — likely without his consent, as is frequently the case when meme coin developers attempt to capitalize on his notoriety. Instead of keeping tokens, Vitalik quickly sold them, turning them into Ethereum, a decision that nearly instantly caused a stir in the market.
The exact moment this swap occurred is marked by a noticeable volume spike on the ETH hourly chart. Fast-moving traders and bots anticipated volatility from either a wider chain reaction or abrupt sell pressure. In monetary terms, 4.4 ETH is hardly a whale-scale liquidation, but the symbolism is what counts, and holders have been known to become alarmed by big token sales by people like Buterin.
In particular, meme coins are susceptible to this. In the past, the tokens frequently go into a death spiral of panic selling liquidity drains and plunging price floors when well-known individuals sell off such holdings. A lot of low-cap projects experienced this collapsing nearly immediately after their distributions were dumping. If trust wanes, DOG may suffer a similar fate.
It is important to keep in mind that not all meme coins collapse instantly. For instance, Shiba Inu managed to withstand a much more extensive sell-off by Buterin and subsequently became one of the market's largest meme assets. Therefore, although today's action is concerning, it is not necessarily a death sentence; however, the onus of proof rests with the DOG community to maintain the line.
Additionally given Buterin's history of swiftly redistributing or selling such assets, the ETH that was purchased might wind up back on the market. This possible overhang raises additional concerns about Ethereum's short-term price stability. Micro-cap meme coin owners should always evaluate their risks correctly in order to avoid losses ignited by large sell-offs.
Vladislav Sopov
U.Today Editorial Team