Celsius Launches Swap of Altcoins for Bitcoin, ETH; Chainlink, Aave, Others At Risk
Bankrupt crypto lender Celsius Network has begun the process of swapping altcoins for bitcoin (BTC) and ethereum (ETH). The recent court approval (June 30) allowed the company to convert its altcoin holdings into two major digital assets, raising concerns about a possible sale of the popular altcoin.
Celsius Network, best known for its altcoin lending services, has been undergoing bankruptcy proceedings since July 2022, when it filed for Chapter 11 protection, revealing liabilities of up to $10 billion. The recent court ruling allows Celsius to convert its altcoins to BTC and ETH from July 1st.
Selling in LINK, AAVE and SNX due to Celsius?
According to on-chain analysis provider LookOnChain, Celsius has been actively moving altcoins to various wallets. Most of the altcoins have been moved to the wallet address “0x4131”. Notably, Celsius made its first swap today. lookonchain Tweeted,
Note that Celsius is starting to swap altcoins for BTC and ETH. Currently: Most of the altcoins have been moved to wallet “0x4131”. 1,393 StaFi ($rETH) was transferred and 1,393 $ETH was received in wintermute trading.
The amount of altcoins held by Celsius Network on the EVM chain is approximately $164.5 million, including:
- 3.16 million links ($19.9 million)
- 98,268 AAVE ($7.36 million)
- 2.9 million SNX ($6.2 million)
- 7.95 million TGBP ($5.49 million)
- 1,812 PAXG ($3.45 million)
- 12.650 BNB ($3.02 million)
- 3.841 million MATIC ($2.65 million)
- 419,899 UNI ($2.27 million)
- 9.25 million ZRX (2.00 million)
In addition to the above, Celsius Network’s wallets also contain approximately $296 million worth of bitcoin, $120 million worth of ethereum, and approximately $100 million (in paper value) of its native token CEL.
Yesterday, data from Arkham Intelligence revealed that Celsius moved approximately $70 million worth of altcoins and stablecoins to different wallets, including wallets belonging to crypto market maker Wintermute, crypto custodian Fireblocks and stablecoin issuer Paxos.
The first swap of altcoins for Ethereum today by Celsius Network raises concerns that the move to the new address was just preparation for a possible sale of the above altcoins. If Celsius sells these altcoins all at once, LINK, AAVE, and SNX could face downsides, but MATIC, UNI, ZRX, and BNB prices could also be negatively impacted.
It is worth noting that although the court approval allows Celsius to convert altcoins to BTC and ETH, the exact details and timeline of the conversion process remain unclear. It is uncertain whether Celsius plans to sell all of its altcoins and in what proportion it intends to acquire BTC and ETH.
Traders and investors holding the above altcoins should closely monitor market developments and be prepared for potential market volatility.
Is Chainlink Price At Risk?
Celsius’ largest altcoin holding, Chainlink, could potentially see the most selling pressure, and the timing is predictably bad. Only two weeks ago, LINK price managed to climb back into the 1+ year trading range between $5.31 and $9.62.
Earlier in the week, LINK price was rejected at the 38.2% Fibonacci retracement level. A fall in Celsius could put the price at risk of another downside correction towards the lower end of the trading range. That’s why Link Marine should closely monitor the addresses of the bankrupt crypto lender.
Featured Image from iStock, Chart from Tradingview.com
source: www.newsbtc.com