Tron founder Justin Sun’s possible sale of MakerDAO’s token, which is often preceded by moving tokens to an exchange, aligns with the restructuring of the DeFi protocol, which has been the subject of controversy.
On Tuesday, crypto investor and Tron network founder Justin Sun moved MakerDAO’s maker (MKR) tokens, valued at $4.3 million, to the crypto exchange Binance.
When investors transfer tokens to an exchange, it typically indicates their intention to sell them. In this case, representatives for Justin Sun have not yet provided a response to a comment request. According to blockchain data from Arkham Intelligence, a wallet associated with Justin Sun sent 6,802 MKR tokens to a Binance account through an intermediary wallet.
The market for MKR tokens has low trading volume and limited liquidity, which means that a substantial sell order can have a significant impact on the token’s price. For example, selling 525 MKR tokens on the MKR/USDT pair on Binance, which is the most active market for MKR, could result in a 2% decrease in the token’s price, as per data from Crypto Watch.
MKR is the token used for governing MakerDAO, a significant decentralized finance (DeFi) protocol that issues the DAI stablecoin, valued at $4.7 billion. Currently, the MKR token is being traded at approximately $632, according to CoinDesk data.
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Sun’s transfer of tokens coincides with a significant transformation happening within MakerDAO, known as Endgame. This restructuring, led by the protocol’s founder Rune Christensen, involves dividing the decentralized organization into smaller, self-governing entities called SubDAOs. These SubDAOs will issue their own tokens. Additionally, MakerDAO is upgrading and renaming its DAI stablecoin and MKR governance token. Furthermore, the protocol aims to invest its substantial reserves into real-world assets.
The Endgame plan, which was voted on and approved by the governance, has faced criticism from some members and investors of the protocol. As a result, several delegates and developers have stepped down from their positions over the past few months. In March, Paradigm Capital, a major investor in the protocol, sold approximately $20 million worth of MKR tokens. The tokens were then transferred to a Coinbase deposit address.
Important: This article is intended solely for informational purposes. It should not be considered or relied upon as legal, tax, investment, financial, or any other form of advice.