Aggressive Ethereum (ETH) selling from 2 firms triggered crypto crash: QCP Capital

QCP Capital stated in its latest report that the recent crypto crash and Ethereum slump were caused by aggressive ETH selling. Jump Trading and Paradigm VC were identified as having contributed to the slump.

In its report from August 5, QCP Capital highlighted that the panic selling and liquidations that happened during Asia morning have caused Bitcoin to fall to $49,000 and Ethereum to hit the $2,100 level.

Pointing to Jump Trading and Paradigm VC’s massive ETH sales, QCP Capital also mentioned that the front-end ETH volume also rose by 30% to 120%.

Macro sentiment worsens following poor US unemployment data

QCP Capital pointed out that macro sentiment has also worsened after the poor US unemployment data from Friday. Interestingly, the VIX touched 50, which was a level that was surpassed only during the COVID panic and the 2008 financial crisis.

Additionally, USD/JPY 1M at-the-money volume also spiked to 16%, which, according to QCP, is likely to cause further volatility. Talking about other factors, QCP spoke about a global risk-off mood that has set in following the murder of Hamas leader by Israel.

Market makers deposit over 130,000 ETH to CEXes

Supporting the statement by QCP, 0xScope Protocol has shared a report on the recent activity of market makers involving Ethereum.

According to the report, crypto market makers have deposited over 130,000 ETH to centralized exchanges. 0xScope mentioned that over that time, the price of Ethereum plunged from $3,000 to as low as $2,100.

Since Aug. 3, crypto market makers have deposited 130,000+ $ETH to CEXes, according to 0xScope research.

Over that time, $ETH crashed from $3,000 to $2,100.

Here's a breakdown of their recent deposits: https://t.co/7CYCxVWPtS

Case in point: Jump Trading started dumping $ETH… https://t.co/7xCMotwRK5

— 0xScope (@ScopeProtocol) August 5, 2024

These market makers include Wintermute (47088 ETH), Jump Trading (36461.5 ETH), Flow Traders (3620 ETH), GSR Markets (292.1 ETH), and Amber Group (65.47 ETH).

Ethereum net outflows since ETF launch hits $430 million

According to a report by CoinShares, Ethereum has seen outflows that touched $146 million. Additionally, this brings the net outflows since the launch of Ethereum ETFs to a high of $430 million.

Even though the crypto market expected a positive run for Ethereum post-ETF launch, the overall crypto market conditions and the economic turmoil have caused a bloodbath.

CoinGecko data shows that Ethereum has lost 27% of its value since last week. Ethereum has dropped from a 7-day high of $3,300 to a low of $2,100 before slightly recovering to its current $2,400 level.