Why is Golem Moving Millions in ETH to Centralized Exchanges

Ethereum-based decentralized computing platform Golem has sent more than $100 million worth of ETH to centralized exchanges such as Binance, Coinbase, and Bitfinex over the past few weeks.

This has become a cause for concern for crypto markets already battered by large Bitcoin selloffs and the prospect of more to come.

Golem is one of the earliest Ethereum initial coin offerings (ICOs), raising around $8 million, or 820,000 in ETH, during the 2016 ICO boom.

Another Entity Dumping on Markets?

“First governments, now old ICOs, who’s next?” commented blockchain analytics platform Nansen, which reported the ETH transfers on July 8.

Golem still holds 126,034 ETH worth around $387 million, according to its wallet address.

Ethereum advocate Anthony Sassano compared it to blockchain platform and one time labeled “Ethereum killer” EOS, which raised $4 billion in an ICO before converting it to Bitcoin and “abandoning the project.”

Yeh Golem dumping more ETH sucks but nothing beats https://t.co/ZRe2h9CU8A raising $4bil worth of ETH to “build EOS” in a year-long ICO, swapping it all for BTC, abandoning EOS, and then getting away with it by paying the SEC a $24 million fine.

Masterclass in scamming.

— sassal.eth/acc 🦇🔊 (@sassal0x) July 8, 2024

On July 9, ConsenSys product manager Jimmy Ragosa called Golem’s behavior “insanely shady” before suggesting that they may be moving the ETH to centralized exchanges to test out staking rather than with the intent to sell.

He shared screenshots from Golem’s social media channels that were also spurious. The team claimed that they were testing staking but provided a link to a blog post stating that they were solo staking.

I will stop pointing out Golem’s insanely shady behavior for now.

Deep inside, I know they’ll come out in August with a reassuring report saying, “Actually, we tested staking through CEXes & did not sell”.

But damn, how easy would it be to simply be transparent from the start?

— Jrag.eth (@JimmyRagosa) July 9, 2024

On July 8, the Golem Project posted on X to address recent activity in its treasury.

It stated that the development of the Golem Network and its ecosystem is its number one priority, adding, “We are an OG Ethereum project, and as such, we want to contribute to the Ethereum ecosystem. Our intention is to solo stake a significant portion of ETH from our treasury.”

Despite pivoting to artificial intelligence, Golem’s native token GLM (formerly GNT) has tanked 76% from its all-time high of $1.32 in 2018.

ETH Price Reaction

There has been no notable reaction in Ethereum markets to the potential selling pressure should Golem decide to offload the assets.

ETH was trading flat on the day at $3,080 following an intraday dip to $2,916 on July 8. However, Ethereum has been downtrending for the past month, losing more than 10% over the past week.

It remains to be seen whether the project will add to the pressure crypto markets have been under recently from large entities offloading large quantities of digital assets.