Altcoins
Celsius exchanges Altcoins for Bitcoin, ETH; Chainlink and Aave in danger
Close up financial graph with uptrend line graph in stock market background
Bankrupt crypto lender Celsius Network has begun the process of exchanging 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, thereby increasing concerns on a potential sale of popular altcoins.
Celsius Network, known for its altcoin lending services, has been in bankruptcy proceedings since July 2022 when it filed for Chapter 11 protection, revealing liabilities of up to $10 billion . The recent court ruling allows Celsius to convert its altcoins into BTC and ETH starting July 1.
Sale of LINK, AAVE and SNX due to the arrival of Celsius?
According to on-chain analytics provider Lookonchain, Celsius is actively moving altcoins to different wallets. Most altcoins have been moved to the “0x4131” wallet address. Remarkably, Celsius made its first trade today. Lookonchain tweeted:
Note that Celsius appears to be starting to trade altcoins for BTC and ETH. Currently: Most altcoins have been transferred to the “0x4131” wallet. Transferred 1,393 StaFi ($rETH) to Wintermute Trading and received 1,393 $ETH.
Altcoins held by Celsius Network total approximately $164.5 million on the EVM chain, including:
- 3.16 million LINK ($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 CEL token.
Yesterday, data from Arkham Intelligence revealed that Celsius moved around $70 million worth of altcoins and stablecoins to different wallets, including those linked to crypto market maker Wintermute, crypto custodian Fireblocks, and stablecoin issuer Paxos.
The first altcoin exchange to Ethereum by Celsius Network today raises concerns that the moves to new addresses are just preparation for a potential sale of the aforementioned altcoins. LINK, AAVE, and SNX could face dumping if Celsius sells these altcoins in one go, but the prices of MATIC, UNI, ZRX, and BNB could also see a negative impact.
It should be noted that while the court approval allows Celsius to convert altcoins into BTC and ETH, the exact details and timeline of the conversion process remain unclear. It is unclear whether Celsius plans to sell all of its altcoins and in what proportion it plans to acquire BTC and ETH.
Traders and investors holding the aforementioned altcoins should closely monitor market developments and prepare for possible market turbulence.
Is Chain Link Price at Risk?
Chainlink, Celsius’ largest altcoin portfolio, could potentially see the most selling pressure, and the timing may be bad. Just two weeks ago, LINK price managed to climb back into the over-year trading range of $5.31 to $9.62.
Earlier in the week, LINK price was rejected at the 38.2% Fibonacci retracement level. A decline in Celsius could put the price in danger of falling back towards the lower end of the trading range. LINK marines should therefore closely monitor the addresses of the bankrupt crypto lender.
Featured image from iStock, chart from TradingView.com