TL;DR:
- Vitalik Buterin, the co-founder of Ethereum, allegedly sold trillions of airdropped ERC20 tokens resulting in a gain of an estimated $700,000 in value.
- The market liquidity of the airdropped tokens was shallow, and the relatively unknown ERC20 tokens plummeted in value after Buterin reportedly sold the funds.
- There was speculation about Buterin’s motives behind the sell-off, with some suggesting it was for tax compliance purposes, while others criticized his decision to sell the tokens instead of sending them to a burn address.
Ethereum Co-Founder Vitalik Buterin’s Address Sells Trillions of Airdropped Tokens, Causes Illiquid Coin Prices to Plummet
On March 7th, onchain observers noticed that Vitalik Buterin, the co-founder of Ethereum, had allegedly sold billions and trillions of airdropped ERC20 tokens, resulting in a gain of an estimated $700,000 in value. The market liquidity of the airdropped tokens was shallow, and the relatively unknown ERC20 tokens plummeted in value after Buterin reportedly sold the funds.
According to a record of token transfers associated with an address labeled “VB,” Vitalik Buterin appears to have sold a significant amount of ERC20 tokens that were airdropped to his address. Blockchain explorer statistics show that the address associated with Buterin sold billions of cult dao (CULT) tokens, billions of MOP, billions of kiboshib (KIBSHI), trillions of dingo (DINGO), and trillions of shikoku (SHIK) tokens.
Peckshield, a blockchain security and data analytics company, also reported on the sold tokens originating from the wallet associated with Buterin. Peckshield noted that the price of shikoku (SHIK) dropped 95.8% against the U.S. dollar. Some token supporters complained that Buterin willingly caused the price of these coins to drop, while others argued that it was Buterin’s funds, and he could do whatever he wanted with them.
Speculation
There is speculation that Buterin may have sold the airdropped tokens for tax compliance purposes. One Twitter user suggested, “Seems like a strange move, he is more than aware this would tank prices and drain liquidity. My assumption is that his accountant warned him these tokens would count as income on his tax sheet. Selling to cover the expense.”
Observers noted that the address associated with Buterin was selling tokens with low liquidity and small market capitalizations throughout the day. The blockchain security and data analytics company Peckshield also reported on the sold tokens originating from the wallet associated with Buterin. Peckshield noted that the price of Shikoku (SHIK) dropped 95.8% against the U.S. dollar. Some token supporters complained that Buterin willingly caused the price of these coins to drop, while others argued that it was Buterin’s funds, and he could do whatever he wanted with them.
Others criticized Buterin’s decision, suggesting that the coins could have been sent to a burn address to destroy them instead. In May 2021, Buterin donated $1 billion worth of shiba inu (SHIB) tokens to India’s Crypto Covid Relief Fund charity after being gifted the tokens during the token’s launch.
A strange coincidence?
Coincidentally, following Buterin’s sale of low-liquidity ERC20 tokens, the Balvi Filantropic Fund, co-founded by Ethereum’s creator, donated $15 million in USD Coin (USDC) to the University of California San Diego. The donated funds will be used to research and study airborne pathogens. Kimberly Prather, a UC San Diego atmospheric chemist, and professor, expressed gratitude to Buterin and the Balvi Fund for their donation in stablecoins.
The market liquidity of airdropped ERC20 tokens was shallow, resulting in a plummet in value after Buterin reportedly sold the funds. Speculations arise as to Buterin’s motives for selling these tokens, with some suggesting tax compliance purposes while others criticized his decision. Coincidentally, Buterin’s Balvi Philanthropic Fund made a $15 million donation in stablecoins to the University of California San Diego after his token sell-off.
This event highlights the potential impact that influential figures can have on the crypto market. Vitalik Buterin is a well-known and respected figure in the crypto community, and his actions can influence the behavior of other investors and traders. This is not the first time that Buterin’s actions have caused a stir in the crypto community. In May 2021, his donation of $1 billion worth of SHIB tokens to charity caused the price of the token to drop by over 30%.
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