Top cryptos in the decentralized finance sector saw a strong sell-off late Sunday as proprietary trading firm Jump Trading's crypto arm began moving millions of dollars into exchanges.
Decrypt reports that it follows crypto investors rushing for the exits due to concerns from economic and geopolitical headwinds.
Austerity fears led to a sharp sell-off in US equity markets on Friday, with the unemployment rate rising to 4.3% in June, which led to global market declines, including a 5.5% drop in Japan's Nikkei 225.
Bitcoin and Ethereum fell 10% and 20%, respectively, as investors pulled $780 million out of long positions, reflecting a shift to safe-haven assets such as bonds amid ongoing growth concerns, according to Decrypt.
The values of Maker, Lido DAO, UniSwap, Aave and Chainlink were some of the top 100 tokens by market capitalization.
Most in that category fell between 18% and 23%, their worst one-day performance since April, according to CoinGecko data.
Blockchain data firm Arkham Intelligence revealed that tens of millions of dollars have been mixed between cold wallets and crypto exchanges controlled by USDC, USDT and Ethereum following moves by Jump Crypto on Sunday.
Exchanges tagged as part of the move include Coinbase, Gate.io and Binance. It is not clear whether Jump Crypto plans to invest some of the $243 million it holds.
The firm did not immediately return a request for comment.
The high-frequency trading firm has many ties to the DeFi sector, once as an active market participant and provider of liquidity on a serum, decentralized exchange hosted on the Solana blockchain.
He was also once a moderator overseeing development at the cross-chain DeFi bridge Wormhole. 19 months ago, it was revised in November last year following a major exploit that saw Jump fill a $320 million hole.
Jump Crypto, a subsidiary of Jump Trading, has faced legal challenges related to the May 2022 collapse of TerraUSD and its involvement in the Terra ecosystem.
The U.S. Securities and Exchange Commission is investigating Jump Crypto for its role in rigging the price of UST, which resulted in nearly $1.3 billion in profits for the company and its CEO, Kanav Kariya.
The indictment is part of an expanded SEC case against Terraform Labs and its founder Do Kwon, who is accused of running a multi-billion dollar crypto asset securities fraud.
The Commodity Futures Trading Commission is also investigating Jump Crypto for trading and investment activity in the market.
While the investigation found no wrongdoing, the Chicago-based firm will face increased regulatory scrutiny.
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