- The defunct crypto lender, Celsius, has announced that it will unstake thousands of ETH in coming weeks. Will this move ease selling pressure on ETH?
Ether (ETH) prices might gain in the coming weeks after crypto lender Celsius, which is restructuring in bankruptcy proceedings, said it will unstake its holdings of the second-largest cryptocurrency, removing a factor that may have contributed to the token’s underperformance in recent months.
The company, which is converting to become a bitcoin miner, had previously said it would include staking in its activities.
The firm has been selling staking rewards on the open market to cover costs associated with the reorganization plan.
“Celsius will unstake existing ETH holdings, which have provided valuable staking rewards income to the estate, to offset certain costs incurred throughout the restructuring process,” the firm said in an X post. “The significant unstaking activity in the next few days will unlock ETH to ensure timely distributions to creditors.”
In preparation of any asset distributions, Celsius has started the process of recalling and rebalancing assets to ensure ample liquidity
— Celsius (@CelsiusNetwork) January 4, 2024
Data from analysis tool Arkham show crypto wallets linked to Celsius have staked over $151 million worth of ether, a position on which it likely earns over 4%-5% in annualized yields.
While the staking rewards may not cause a large amount of ether sales, they may have contributed to negative sentiment for the token, alongside other factors such as the interest in other blockchains.
Meanwhile, outflow data shows Celsius sent over 30,000 ETH to custodian Fireblocks in the past week, some of which was deposited at crypto exchange Coinbase, where it may have been exchanged for stablecoins.
Millions worth of ether has been sent to custodians and exchanges in the past week.