January 25, 2019

5% of the world’s Ethereum supply was sold on the same day – and no one knows why

By Lucy Ingham

An investigation into the biggest Ethereum transactions of the last quarter has discovered that 5% of the total Ethereum supply, worth over $500m, was sold in one day at the end of last year.

According to ORS CryptoHound, on 1 December 2018 the six wallets with the largest holdings of Ethereum transferred vast sums of the cryptocurrency.

This Ethereum cycled through multiple transactions, ultimately ending up equally distributed between a larger number of wallets – 39 in total – each with a holding of exactly 150,000 ETH.

Is the sale of the Ethereum supply the work of one person?

While to the casual observer, this activity would appear to be the work of multiple sellers, it appears that this Ethereum supply transfer was the work of a single individual or a lone company.

In addition to the fact that all of the Ethereum ended up in 39 wallets each with the same total holding, the six initial wallets appear to have all been created on the same day.

The initial wallets also had a similarly structured cryptocurrency portfolio, with a 92% – 98% share of OmiseGo (OMG) tokens, which are based on the Ethereum standard ERC-20.

Who is behind the sale?

While it is not known who is behind the moves, the ORS CryptoHound researchers did formulate a theory about who they might be.

They believe that the individual in question may be a so-called ‘crypto whale’, a person with very large cryptocurrency holdings, who has attempted to fake a decentralisation of their holdings, making it look like they are no longer held by a single party.

The researchers suspect that the individual or company in question made the move to separate their holdings in ETH and OMG, believing this would protect the integrity of Ethereum as a whole.

ORS CryptoHound, the company behind the research, is a blockchain analytics and investigative tool powered by AI.

“This investigation is one of the early case studies showing AI’s potential in blockchain and cryptocurrency analysis,” said Fabrizio Fontana, chief analyst of the ORS CryptoHound research team.

“Our goal is to provide a free and easy-to-use platform for everyone who wants to collect as much data as possible about a specific blockchain address or transaction.”

Verdict deals analysis methodology

This analysis considers only announced and completed deals from the GlobalData financial deals database and excludes all terminated and rumoured deals. Country and industry are defined according to the headquarters and dominant industry of the target firm. The term ‘acquisition’ refers to both completed deals and those in the bidding stage.

GlobalData tracks real-time data concerning all merger and acquisition, private equity/venture capital and asset transaction activity around the world from thousands of company websites and other reliable sources.

More in-depth reports and analysis on all reported deals are available for subscribers to GlobalData’s deals database.

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