Ethereum Drops Below $2,300 Amid Rumors of Jump Crypto Unwinding Positions

The price of ether fell 20% as Jump Crypto appeared to offload millions worth of crypto on Sunday.

Jump Crypto, the crypto trading arm of Jump Trading that has been a major market maker in the space, is seemingly unwinding the majority of its positions.

Blockchain data from Arkham shows that wallets tagged as Jump have been moving millions of crypto into hot wallets at crypto exchanges Binance, Coinbase, OKX, Bybit and Gate.io through Sunday. The price of ether recorded a steep decline, losing 20% over in the last 24 hours to trade at a low of $2,300.

Onchain data analyst “@EmberCN” noted that Jump had already redeemed $410 million worth of wrapped stETH (wstETH) and sent it to exchanges. 

Market participants speculated that Jump’s activity could explain the subdued price action in ether following the launch of spot ether exchange-traded funds (ETFs) in the U.S.

“Jump liquidating their crypto book into thin markets on a summer Sunday afternoon, perfectly sums up why their crypto operation is such a mess,” said Adam Cochran, partner at Cinneamhain Ventures, on X. 

Meanwhile, some industry watchers like Ethereum commentator Anthony Sassano, suggested that Jump fully exiting the crypto industry might be one of the most bullish things to happen. 

“They’ve been a complete parasite on crypto for years and the industry will be much better off without them,” said Sassano.

The U.S. Commodities and Futures Trading Commission (CFTC) is reportedly investigating Jump’s trading and investing activity in the crypto space. Jump’s former president Kanav Kariya announced his departure from the firm shortly after reports of the CFTC probe. Jump is also said to be the “unnamed trading firm” that intervened and supported the TerraUSD (UST) stablecoin when it briefly lost its peg to the U.S. dollar in May 2021. 

While blockchain activity would imply that Jump is officially getting out of the crypto market making business, it is unclear whether the firm still intends to build infrastructure in the space. Last month, Jump’s new Solana validator client Firedancer built its first accepted block on the testnet.