A long-dormant Ethereum ICO participant recently moved 3,510 ETH worth about $912 million and transferred the assets to the Kraken exchange after two years of inactivity. The participant, who got 150,000 ETH during Ethereum’s Genesis event for $46,500, now has $389.7 million.

The latest deposit marks the first significant movement from this address in over 771 days, as the wallet previously received three separate transfers of 5,000 ETH each. After this transaction, the wallet has around 11,490 ETH worth of $30.6 million, as well as 16 other tokens.

The recent activities of this participant is a cause of concern as large deposits on the exchange are seen as an indicator of the participant’s intention to sell due to the liquidity offered in the exchange.

Ethereum Foundation’s Continued ETH Sales Raise Concerns

Besides the whale activity, the Ethereum Foundation has been rampantly liquidating ETH. As per Arkham, the above mentioned Ethereum Foundation address (0xd7…c1f4) transferred an additional 200 ETH for $528,000 DAI through Cow Protocol between 16;02 and 16;16 UTC+8 on September 23.

The money was then transferred to another Ethereum Foundation ETH address. This sale alone brings the total ETH sold by the Foundation in September to 1,150 ETH, equivalent to about $2.8 million.

On 21st of September the Foundation sold 300 ETH for about $763,000 with an average ETH price of $2,543. These sales entailed exchanging ETH for DAI, which is one of the several such operations performed by the Foundation this month.

Such frequent sales that occur every four to seven days have raised interest from investors who are wary of the effects of regular ETH liquidations in the market.

Rising Ethereum Transaction Fees and Burn Rates

During the same period that the Foundation is still selling, the transaction fees and burning rates within the Ethereum network have also risen.

By September 23, the seven-day moving average transaction fee had reached $3.52, up from just $0.85 at the beginning of the month. This represents a substantial rise in network fees, the last time such costs were as low as this was in July 2020 before Ethereum shift to the proof of stake model.

Source: IntoTheBlock

Furthermore, the burn rate of ETH has risen significantly, going up by more than 1600% from 80.27 ETH on September 1 to 1,360 ETH on September 21.

The main contributors to this burn are high gas use dApps such as Uniswap, trading bots like Maestro and Banana Gun, and transactions involving popular stablecoins such as Tether (USDT) and USD Coin (USDC).

Market Outlook Amid Increased ETH Outflows

ETH liquidations by Ethereum Foundation and other large investors have taken place at a time when institutions have been bearish. According to the latest report from CoinShares, Ethereum witnessed weekly outflows of $28.5 million and total outflows for the month stand at $145.7 million.

On the other hand, Bitcoin received large inflows in the same period as institutions shifted their focus away from Ethereum.

Even though there has been continuous outflow and market concerns, the price of Ethereum has been stable at around $2,635 at the time of writing.

However, the liquidation by the Foundation and large holders is still a potential risk because the increase of ETH on exchanges may lead to more selling pressure. Experts have cautioned that if this persists, it may pose risks to the sustainability of or even an increase in the price of Ethereum.