Justin Sun, the co-founder of Tron, withdrew 30,000 ETH, worth roughly $56 million, via two addresses via Lido, a liquidity staking service provider, on July 10, Lookonchain reveals. Following his move, his Ethereum stake via Lido is down to 263,294 ETH, or $491.6 million at spot rates.

Lookonchain, a blockchain analytics platform, notes that between February 25 and 27, Sun staked 288,100 ETH, or $538 million, and earned 5,194 ETH, or $9 million. This translates to average daily earnings of 38 ETH, or $72,000, going by the annualized percentage yield (APY) of around 4.87% offered by Lido on Ethereum stakers.

The reasons behind Sun’s withdrawal of 30,000 ETH from Lido are unclear. It could indicate his intention to sell some of the ETH, transfer to a different staking platform, or even run his private Ethereum validator node.

Despite this transfer, Sun remains one of the largest stakers at Lido, accounting for over 9% of the total ETH staked. While Sun’s decision to unstaked and transfer coins may be a cause of concern, ETH prices are firm when writing on July 10 and edging closer to $1,900.

Contrary to fears ahead of the Shanghai upgrade in mid-April, the number of users staking ETH remains upward. Trackers show that over 21 million ETH has been locked by over 657,000 validators as of July 10. 

With the Shanghai upgrade implemented, ETH holders who had staked at least 32 ETH in the Beacon Chain from December 2020 can withdraw their assets. Despite earlier fears that more coins will be withdrawn and sold in the spot markets, impacting ETH prices, more validators and more coins have been locked on the Beacon Chain and other staking solutions. 

Lido, the leading staking provider for ETH, is the largest decentralized finance (DeFi) protocol by total value locked (TVL), according to DeFiLlama. As of July 10, Lido managed over $14.6 billion of assets, most of which are ETH. 

Over $14.5 billion of ETH have been delegated and locked through Lido infrastructure. In Lido, users can stake ETH and other supported coins without needing lock-up periods or meeting high requirements, making it an attractive option for some investors.

In lawsuits filed against crypto exchanges Binance and Coinbase in early June, the United States Securities and Exchange Commission (SEC) alleged that some proof-of-stake coins, including Cardano’s ADA and Algorand’s ALGO, were unregistered securities. 

Following this assessment, their prices tanked, even impacting ETH. This is partly because Ethereum is now a proof-of-stake network after transiting from a proof-of-work algorithm and uses the same consensus system as those employed by competing smart contract platforms accused of issuing unregistered securities. The situation is worsened by Gary Gensler’s failure to clarify whether ETH is a utility like Bitcoin. 

Cover image from Canvas, chart from Tradingview

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