Ethereum co-founder Vitalik Buterin has sold all his MakerDAO (MKR) tokens for 353 ETH ($581,000), generating speculation among the crypto community on the motivation to do so.
MakerDAO’s MKR token is among the best-performing digital assets and has registered an increase of over 9% in the past week.
Buterin Dumps His MKR Holdings
MakerDAO has cemented itself as one of the most prominent players in the decentralized finance (DeFi) space. Through its native MKR token and the DAI stablecoin, the protocol has earned the trust of the crypto community. However, recent events involving MakerDAO’s NewChain project and Ethereum co-founder Vitalik Buterin could serve to reshape certain narratives. Now, in an unexpected move that has drawn considerable attention from the crypto community, Buterin has sold all his MKR tokens for 350 ETH, around $581,000. The sale was conducted through CoWswap.
The sale comes after an extended period of dormancy and is Buterin’s first transaction involving MKR in over 2 years. The last time Buterin had sold MKR tokens was in 2021 when he donated 100 MKR to India’s Covid relief fund. Buterin bought around 1071 MKR tokens in 2018 when the token was trading at $905. With the token now trading over the $1100 mark, it looks like the Ethereum co-founder has made a neat profit on his holdings.
A History Of Divesting
Vitalik Buterin has a long history of divesting from his digital asset holdings. In August, it emerged that he had liquidated around 600 ETH, valued at around $1 million, through crypto exchange Coinbase. Market watchers closely followed the transaction and speculated that it exerted considerable downward pressure on the price of ETH, which was facing substantial challenges at the time. In March, he also moved around 200 ETH to Kraken and also dumped several unsolicited altcoins, exchanging them for around 439 ETH.
Community Questions Motives
The sale of Buterin’s MKR tokens has sparked considerable speculation in the crypto community, with many trying to guess the reasons behind the move. This included Justin Sun, the founder of the Tron Network. Some have speculated that this could be in retaliation to recent comments made by the co-founder of MakerDAO, Rune Christensen. However, others have interpreted this as a bearish indicator and a lack of faith in MakerDAO’s strategy. Others have also stated that they believe MKR to be overvalued and ETH to be undervalued.
Is MakerDAO’s NewChain The Reason?
MakerDAO has recently amped up the development of NewChain, with Christensen a key proponent of the initiative. NewChain is critical to MakerDAO’s Endgame upgrade. Endgame’s final objective is the complete re-implementation of the Maker protocol within a new blockchain ecosystem.
This will mark a significant paradigm shift for the protocol, especially as Christensen has advocated using Solana’s codebase as the foundational framework for NewChain. This marks a pivot away from Ethereum and underscores the project’s commitment towards exploring alternative blockchain solutions as a means to enhance its capabilities.
“The last phase of Endgame is the launch of a native blockchain for Maker with the codename NewChain. It will make the ecosystem more secure and efficient. After some research, I believe the Solana codebase should be considered as the basis for NewChain.”
Impact On MKR Price
The MKR token has been a strong performer recently, registering an increase of 9% over the past seven days. However, in response to Buterin selling his MKR holdings, the MKR price registered a significant drop, falling by nearly 4% in a 24-hour period. Additionally, the network growth of the MKR token also registered a sharp decline. The decrease indicated waning interest from new addresses towards MKR trading. The velocity of MKR, a metric used to represent the token’s trading frequency, also showed signs of a slowdown.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.