Large holders of Bitcoin, known as whales, are liquidating portions of their Bitcoin holdings to capitalize on the price movement of Ether.
This indicates a “natural rotation” in the market towards Ether (ETH) and other altcoins that show greater potential for gains, according to Nicolai Sondergaard, a research analyst at the crypto intelligence platform Nansen, in a statement to Cointelegraph.
Despite growing fears of selling pressure, as the Ethereum validator queue hit a record high nearing $5 billion worth of ETH tokens on Thursday, resulting in withdrawal times stretching to an unprecedented 18 days and 16 hours, investor capital seems to be shifting.
This investor shift might be linked to a significant transaction involving an $11 billion whale, who converted over $2.59 billion worth of Bitcoin (BTC) into a $2.2 billion spot Ether and a $577 million perpetual long position, securing a profit of $33 million from the perpetuals long position on Monday, as reported by Cointelegraph.
Whales invest $456M in Ether through “natural rotation” from Bitcoin
Cryptocurrency whales, or significant investors, are purchasing substantial amounts of Ether, as analysts note an organic rotation of investor interest toward altcoins with greater upside potential.
According to blockchain data platform Arkham, nine major whale addresses collectively acquired $456 million worth of Ether (ETH) from Bitgo and Galaxy Digital, as noted in a Tuesday X post.
The increasing demand from whales for the second-largest cryptocurrency indicates the market’s “natural rotation” towards Ether and other altcoins with significant growth potential, per Nansen’s Nicolai Sondergaard.
“Much of this reflects natural rotation, with investors securing profits from Bitcoin’s gains and moving into alternative tokens for potential upside,” the analyst informed Cointelegraph, adding:
“Ether, in particular, is gaining due to its strong current visibility and momentum from Ether treasury companies.”
While the recent movements of Ether whales are “significant,” the “larger trend involves flows extending beyond Bitcoin as market participants seek the next opportunity,” the analyst stated.
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Ethereum exit queue hits record $5B ETH, raising sell pressure concerns
The Ethereum network is experiencing the largest exit of validators in the history of crypto, with over 1 million Ether tokens currently awaiting withdrawal from staking via Ethereum’s proof-of-stake (PoS) system.
On Thursday, Ethereum’s exit queue exceeded 1 million Ether (ETH) valued at $4.96 billion. This amount is earmarked for withdrawal by the network’s validators, who are critical in adding new blocks and verifying transactions, thus playing a crucial role in the blockchain’s operation.
The significant validator exodus has pushed the exit waiting period to an unprecedented 18 days and 16 hours, as per data from validatorqueue.com.
While it doesn’t imply that all validators intend to sell their assets, a considerable portion of the nearly $5 billion might be liquidated to secure profits, given that Ether has appreciated by 72% over the last three months.
“The exit queue surpassing 1 million ETH indicates healthy market dynamics rather than a reason for alarm,” stated Marcin Kazmierczak, co-founder of RedStone blockchain oracle, to Cointelegraph, adding:
“It’s crucial to recognize that these exits are minimal compared to the institutional capital flowing into Ethereum.”
The “unprecedented demand” from public entities, such as treasury companies and exchange-traded funds, suggests that the validator sales are “easily absorbed by this institutional interest,” he explained.
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Tokenization through blockchain prevents 394M tons of CO₂ in $32B ESG initiative
Arx Veritas, a wealth tokenization platform, along with tokenization infrastructure firm Blubird, are leveraging blockchain technology to avert nearly 400 million tons of CO₂ emissions, achieving a milestone in the digital asset tokenization sector.
The two entities have tokenized $32 billion worth of Emission Reduction Assets (ERAs) within Blubird’s Redbelly Network, aspiring to establish a “new standard” for the financing and tracking of sustainability initiatives.
The tokenized assets comprise capped oil wells and coal mines, representing over 394 million tons of prevented CO₂ emissions, marking the largest endeavor in alignment with the Environmental, Social, and Governance (ESG) framework.
The 394 million tons of avoided CO₂ emissions arise from two primary sources: the extraction, processing, shipping, and combustion of coal that would have otherwise been utilized, along with the pollutants withheld by capping defunct oil wells.
These prevented emissions are equivalent to roughly 395 million round-trip flights from New York to London, approximately 986 billion miles driven by an average passenger vehicle, or 105 times the annual CO₂ emissions of Iceland.
Bluebird is experiencing “significant institutional interest in the tokenization of ESG-aligned assets, with transactions exceeding half a billion dollars currently under negotiations and a major institutional purchase soon to conclude,” the firm remarked in a Thursday announcement shared with Cointelegraph.
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Kanye West’s YZY token leads to $74M loss for 51,000 traders, while 11 profited $1M
Over 51,000 traders faced significant losses from Kanye West’s newly launched memecoin, underscoring the inherent risks associated with trading celebrity-backed tokens that lack intrinsic technological value.
The YZY token, linked to Kanye West, debuted on the Solana blockchain on August 21. Initially surging 1,400% within the first hour, it subsequently plummeted by over 80% in value.
Out of the 70,200 traders who engaged with this celebrity-endorsed token, more than 51,800 experienced losses, with three traders individually losing over $1 million, as reported by blockchain data platform Bubblemaps.
“Meanwhile, 11 wallets resulted in profits exceeding $1M,” Bubblemaps noted in a Wednesday X post.
While a large majority of traders suffered losses, only 11 out of 70,000 wallets achieved profits over $1 million, and 99 wallets raked in over $100,000.
Currently, the YZY token price is down over 80% from its peak, trading at $0.5515 with just 19,531 traders holding the token, as evidenced by data from blockchain intelligence platform Nansen.
Former kickboxer Andrew Tate was among the traders aiming to profit from the rapper-endorsed token, opening a 3x leveraged short position on the YZY token, resulting in a total loss of $700,000 on his Hyperliquid account associated with Tate, Cointelegraph disclosed on Friday.
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Hyperliquid experiences surge as Arthur Hayes predicts 126x growth in Tokyo
The native token supporting the decentralized derivatives exchange Hyperliquid recorded one of the few gains in the last 24 hours, as crypto entrepreneur Arthur Hayes mentioned during a conference in Tokyo that he anticipates a 126x increase over the next three years.
At the time of writing, Hyperliquid (HYPE) had seen an almost 4% increase in the last 24 hours, trading at $45.64, although it briefly crossed the $47 mark earlier that day.
Arthur Hayes, co-founder of BitMEX, shared this prediction at the WebX 2025 conference in Tokyo, stating that the expansion of stablecoins would elevate the DEX’s annualized revenue to $258 billion, up from its present annualized earnings of $1.2 billion.
Hyperliquid operates as a decentralized exchange for perpetual futures, allowing speculators to leverage positions on crypto assets without holding them.
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Overview of the DeFi market
Data from Cointelegraph Markets Pro and TradingView indicates that most of the 100 largest cryptocurrencies by market capitalization finished the week in decline.
The OKB (OKB) token experienced the steepest drop in the top 100, plummeting over 25%, followed closely by the Aerodrome Finance (AERO) token, which fell more than 15% over the week.
Thank you for reading our summary of the week’s most significant developments in DeFi. Join us next Friday for further stories, insights, and education in this dynamically evolving sector.
