Justin Sun, the co-founder of Tron, withdrew 30,000 ETH, worth approximately $56 million, on July 10 via two addresses via Lido, a liquidity brokerage service provider, Lookonchain reveals. After his move, his Ethereum stake through Lido has dropped to 263,294 ETH, or $491.6 million at spot rates.
Justin Sun is moving away from Ethereum
Lookonchain, a blockchain analytics platform, notes that between February 25 and February 27, Sun wagered 288,100 ETH or $538 million and earned 5,194 ETH or $9 million. This translates into an average daily profit of 38 ETH, or $72,000, assuming the annual percentage return (APY) of about 4.87% offered by Lido on Ethereum stakers.
The reasons behind Sun’s withdrawal of 30,000 ETH from Lido are unclear. It could indicate his intention to sell some of the ETH, move to another staking platform, or even run his private Ethereum validator node.
Despite this transfer, Sun remains one of the largest stakers at Lido, accounting for more than 9% of ETH’s total stake. While Sun’s decision to stake and transfer coins may be cause for concern, ETH prices are solid on July 10 and approaching $1,900.
Contrary to fears prior to the Shanghai upgrade in mid-April, the number of users wagering ETH continues to rise. trackers show that as of July 10, over 21 million ETH has been locked by over 657,000 validators.
Now that the Shanghai upgrade has been implemented, ETH holders who have staked at least 32 ETH in the Beacon Chain as of December 2020 can withdraw their assets. Despite previous fears that more coins will be withdrawn and sold on the spot markets, impacting ETH prices, more validators and more coins have been locked onto the Beacon Chain and other staking solutions.
Will the SEC Mute Coin Spending?
Lido, the leading ETH staking provider, is the largest decentralized finance (DeFi) protocol according to Total Value Locked (TVL) DeFiLlama. As of July 10, Lido managed more than $14.6 billion in assets, most of which are ETH.
Over $14.5 billion in ETH has been delegated and locked through the Lido infrastructure. Lido allows users to stake ETH and other supported coins without any lock-up periods or high requirements, making it an attractive option for some investors.
In lawsuits filed in early June against crypto exchanges Binance and Coinbase, the US Securities and Exchange Commission (SEC) alleged that some proof-of-stake coins, including Cardano’s ADA and Algorand’s ALGO, were unregistered securities.
After this review, their prices fell, even affecting ETH. This is partly because Ethereum is now a proof-of-stake network after transitioning from a proof-of-work algorithm and uses the same consensus system used by rival smart contract platforms accused of issuing unregistered effects. The situation is compounded by Gary Gensler’s failure to clarify whether ETH is a utility like Bitcoin.
Cover image of Canvas, chart from Tradingview