Try Quests to earn cryptoETH Price Down Bad?
Has ETH really tanked so bad? Why was it and how will the future predictions look like?
Trading Activity
Lookin at the daily selling volume on EZ_SWAPS table which mostly include Uniswap V3 and Sushiswap trades, We can see that selling volume on Nov 20th and Nov 21st, which were the only days that hacker sold ETH, is not high at all.
Even on these two days, hacker’s sold volume is below 5% and 1% on total volume. actually the high selling pressure happens on Nov 22nd in which hacker wallets are not trading at all.
But Trading transactions are increasing meaning that retail users are acting according to new sentiment of market
On the other hand, after FTX collapse the selling pressure was constantly decreasing and Nov 20th and Nov 21st were the lowest trading days in past 10 days
Another notable fact is that hacker wallets were never among the top daily selling addresses with the most ETH sold.
These all pointes, along with the fact that there are many more DEXs and CEXs which we don’t have access to their data now (They will add to selling volume), shows that hacker’s selling volume is not much to be considered a determinant volume factor on drop in price.
It is rather the drama and the fear associated with it that leads to price drop. note that the hacker was probably shorting ETH on a CEX and made more profit through this than selling ETH.
Recently, specially in last week, there has been a lot of discussions regarding sudden drop in price of ETH in Crypto Twitter. ETH price started to drop ~ 10% in two days and that seemed to be very upsetting moment for everyone as if this is the first a crypto asset move like this! ( Already reached back to previous prices earlier today on Nov 24th).
Crypto Twitter immediately reacted to price drop and covered its instant movements, and the reason being FTX hacker dropping “heavy” loads of ETH on market. This news suddenly created chaos and opened the FTX wound once again.
Let’s see how ETH price performed lately and how FTX hacker moves could have impacted on it.
Methodological Notes:
- As for the structure of analysis, I am claiming that the selling activity wasn’t big enough to have that much impact on price, and it was mostly due to drama that was created on twitter and change in sentiment consequently. I will try to provide facts and data to prove my standpoint.
- I am using flipside crypto application and database t render this analysis. Some information might not be as inclusive as possible due to database limitations. Like swapping volumes definitely do not include all DEX and CEX trades and is mostly limited to Uniswap and Sushiswap interactions.
- It seems that FTX Account Drainer label on Etherscan is not accurate. I considered all the wallets that received ETH from main hacker’s wallet as the “Hacker wallets”
- I have used some codes and brilliant ideas of this dashboard
What is the story of FTX hacker?
On Nov 11th and hours after that FTX filed for Chapter 11 bankruptcy, a hacker started draining wallets associated with FTX and stole ~ 450 Million dollars worth of crypto currencies from FTX global and FTX US. Since the majority of stolen assets were ETH, this made the hacked one of top holders of ETH around the market.
At the beginning, it wasn’t clear who is the owner, or was it really a hack? that’s because some regulatories claimed to having the full control of remaining FTX crypto assets. But on Nov 20th, The wallet started to move some of stolen ETH to another address and immediately swap them to WBTC on Uniswap through 1Inch Router.
The Drama
This is when the drama begins and all hell breaks loose suddenly on Crypto twitter. Users start to watch hacker’s moves and at according to its possible impact. A costume picture made by a user goes viral showing how hacker’s swaps from ETH to BTC has impacted the ETH price.
Now, everyone is talking about how ETH is dropping while BTC is not affected. But this won’t last too long and all crypto market goes down notably consequently.
Things you’ll learn in this dashboard:
- How hacker’s ETH balance changed over time
- How much hacker sold and what assets bought instead
- Daily selling volume of ETH and Hacker’s share of the volume
- Daily transaction Volume and transactions count of trading ETH
- Daily Top selling addresses of past 7 days
- ETH Price performance comparing to some other well-known cryptos during the incident
- ETH price Total Performance after terra crash
Checking Facts
Right in the middle of the storm, while the hacker awakened and started dropping ETH on market, a costume made picture went viral showing how hacker swaps impacted the price.
I went to check the credibility of picture and found that it wasn’t as honest as it should be.
Left picture (Twitter Viral Post) Indicates that price drop is directly impacted by the hacker’s trades, while right picture (mine) shows that it take some minutes for price to drop.
Although there is no doubt that hacker is creating sell pressure, but as we see later in dashboard, the volume is not too much that can not be handled by the market.
I believe the CT drama itself made the sentiment negative immediately and all aware people started selling ETH.
The other problem is that I’ve seen some articles and arguments on how decreasing hacker’s ETH balance is parallel with drop in price.
But we should notice that the hacker started transferring ETH to 13 other wallets and if we check their sum balance we can see that it didn’t change much after selling on Nov 20th.
Hacker’s wallets had 18 swap transactions in total and sold almost 53K ETH worth 60 million dollars, and bought mostly renBTC and bridged it on bitcoin network.
The remaining ~ 200k ETH is almost untouched and its heavy shadow of selling fear upon market, preventing to form a reliable floor
Price Action and Performance
Comparing ETH price action to some other popular tokens of market, shows that we can’t set a single statement to define what is globally happening in market. It is probably safe to say ETH price dropped prior to other assets and soon followed by them. Also the recovery phase is different in every case depending on what is happening in their ecosystem. For example, CRV was experiencing a complex set of actions regarding liquidations of some loans and counter actions to prevent them and this caused a huge increase in price.
Also looking at charts below, we can see that there were many cases that performed worth that ETH in initial drop and also worth in terms of recovery.
We should consider that ETH performed much better than most highcap assets after historical ATH and after Terra crash too.
And let’s not forget that ETH had >100% recovery after its new ATL while most assets were struggling to find supporters
It is obvious that market sentiment significantly decreased and got damaged since terra crash. We are officially in a probable multi year bear market. This is absolutely normal in these circumstances that prices drop every now and then with different factors. But we need to be careful about what is the real reason since these may have serious impact on viability of our financial decisions.
I believe ETH performance in bear market was acceptable in so far and I’m not approving the new narrative of sudden ETH down price. The story of FTX hacker is one of the instances which becomes a powerful narrative without being rooted in facts and we should steer clear of these cases.