- Per multiple reports, the FTX hacker converted a huge part of the stolen FTX funds (30,000 ETH) to Bitcoin.
- The broader market correction is an additional factor that caused the decline in ETH’s price.
Ethereum dived into extreme selling pressure on Sunday after the FTX exchange’s hacker disposed of some of their ETH holdings. The move pushed the token’s price down by 8.09 percent, it now trades at $1,126 at the time of writing.
Following the news that the hacker who stole $600 million from the embattled crypto exchange FTX has converted the stolen ETH stash to Bitcoin, the price of Ethereum plummeted sharply. Reports indicate that over the past week, the hacker swapped all the stablecoins to ETH, with the total accumulated value estimated to be $288 million.
According to a crypto journalist, Colin Wu, citing data from Etherscan, tracked activities show that the hacker has converted a large amount of Ethereum tokens into Bitcoin. Close to 30,000 ETH has already been exchanged into BTC, resulting in nearly 1,070 BTC being moved to the BTC ecosystem. Furthermore, as regulators continue to assess the damage triggered by the FTX bankruptcy, the latest event has brought another imminent wreckage to the Ethereum network.
The FTX hacker address (0x59…d32b) exchanged a large amount of ETH to BTC today, 15,000 ETH has been transferred to the new address and converted into about 684.6 reBTC and send to the BTC network. The hacker (0x59…d32b) still holds 185,000 ETH. https://t.co/yflFR9AR9N https://t.co/vIapl79NTE
— Wu Blockchain (@WuBlockchain) November 21, 2022
FTX currently owes more than $3.1 billion to a handful of its creditors, with the exchange unable to find a way to offset the enormous debt. In addition, there is a growing concern in the crypto community that more exchanges are likely to crash amid the broader market crisis.
Reports emerged in the past week that another crypto lender, BlockFi, is set to file a bankruptcy claim. Accordingly, the impact of the FTX crisis has a far-reaching effect than the industry earlier imagined.
In an interview with Bloomberg TV, the founder of MIT Cryptoeconomics Lab, Christian Catalini, noted that “the current FTX scandal has brought to the fore another reminder why the crypto industry needs urgent regulatory clarity and framework.”
He added that the continued hype over the minting of new coins and the accompanied speculations had created an interruption from the need to develop actual crypto use cases which can solve consumers’ problems.
Does Ethereum slip below $1,000?
In terms of performance, the current ETH price correction has pushed the second-largest crypto asset below the vastly underperforming Bitcoin. As a result, the broader crypto market cap is down 5.6 percent, sliding further to under $800 billion. While Ethereum has slumped by 8 percent, Bitcoin has failed to move a mile.
The leading digital asset has corrected by nearly 3 percent and currently trades around the $16,000 mark. Some weeks ago, ETH had been performing below expectations and couldn’t overtake Bitcoin in terms of performance despite the completion of the Merge.
Industry experts believe that the current market situation will likely push the price of Ethereum below $1,000. However, it is not just Ethereum that is underperforming. All the top ten altcoins have also witnessed 5-10 percent declines.
As the price of Ethereum tanks, data from the Whale Alert shows that crypto Whales have moved about 400,000 ETH from some exchanges. The Whales are likely using the drop in ETH’s price to accumulate more of it before its price spikes again.
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