Major cryptocurrencies in the decentralized finance sector saw sharp declines Sunday evening as the crypto arm of proprietary trading firm Jump Trading began moving millions of dollars to exchanges.
This follows cryptocurrency investors rushing for the exits, spooked by concerns arising from economic and geopolitical headwinds, Decrypt reported.
Recession fears led to a sharp decline in US stock markets on Friday, with the unemployment rate hitting 4.3% in June, triggering declines in global markets, including a 5.5% drop in Japan’s Nikkei 225.
Bitcoin and Ethereum fell 10% and 20%, respectively, as investors withdrew $780 million in long positions, indicating a shift toward safer assets like bonds amid lingering growth concerns. Decrypt has been said.
Maker, Lido DAO, UniSwap, Aave, and Chainlink were among the hardest hit among the top 100 tokens by market cap.
Most stocks in this category fell between 18% and 23%, marking their worst single-day performance since April, according to data from CoinGecko.
This follows moves by Jump Crypto on Sunday, which began shuffling tens of millions of dollars in USDC, USDT and Ethereum between cold wallets it controls and crypto exchanges, according to data from blockchain data firm Arhkham Intelligence.
Exchanges affected by the move include Coinbase, Gate.io, and Binance. It is unclear whether Jump Crypto intends to liquidate or has already liquidated any of the $243 million in cryptocurrencies it holds.
The company did not immediately respond to a request for comment.
The high-frequency trading firm has several ties to the DeFi sector, including as an active market participant and liquidity provider on Serum, a decentralized exchange hosted on the Solana blockchain.
Jump was once a steward overseeing the development of the cross-chain DeFi bridge Wormhole. That was upended in November last year following a major exploit that saw Jump plug a $320 million hole 19 months prior.
Jump Crypto, a subsidiary of Jump Trading, has faced legal challenges related to its involvement in the collapse of TerraUSD and the Terra ecosystem in May 2022.
The U.S. Securities and Exchange Commission is investigating Jump Crypto for its alleged role in manipulating the price of UST, resulting in approximately $1.3 billion in profits for the company and its CEO, Kanav Kariya.
The allegations are part of a broader SEC case against Terraform Labs and its founder, Do Kwon, who is accused of running a multi-billion dollar crypto asset securities scam.
The Commodity Futures Trading Commission is also currently investigating Jump Crypto for its trading and investment activities in the market.
While the investigation does not implicate any wrongdoing, it adds to the regulatory scrutiny facing the Chicago-based company.
Daily report Newsletter
Start each day with today’s top stories, plus original features, a podcast, videos and more.
