China Resumes Sale of Seized Ethereum – What Does This Mean?

The Chinese government is reportedly starting to sell off a large portion of Ethereum (ETH) that was confiscated from the infamous PlusToken pyramid scheme, contributing to recent price drops in the cryptocurrency market.

In early August, Ethereum linked to this case began moving on-chain for the first time since 2021, with around 7,000 ETH, part of a total of 542,000 ETH valued at $1.3 billion, sent to exchanges in just 24 hours. This movement marks the beginning of asset liquidation.

PlusToken, which ran from early 2018 until June 2019, defrauded investors out of billions before Chinese authorities shut it down.

At its height, it amassed around 194,000 BTC (about $2 billion at that time) and 830,000 ETH (worth $215 million). A court decision in 2020 mandated that the seized assets be liquidated to compensate victims.

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Most of the confiscated Bitcoin was sold between August 2019 and March 2020, with an estimated value of $1.3 billion. In contrast, the seized Ethereum remained mostly untouched until mid-2021.

Now, as the Chinese government resumes selling the remaining ETH, the market may brace for further downward pressure on prices.

Alexander Stefanov