An Ethereum ETH/USD wallet address purchased at least $400,000 worth of cryptocurrency tokens due to be listed by Coinbase Global Inc COIN a day before the official announcement was made.
What Happened: According to on-chain transactions highlighted by noted cryptocurrency trader Cobie on Twitter, the wallet acquired a significant amount of six tokens mentioned in Coinbase’s list of assets “under consideration” before the information was made public.
The tokens acquired were Indexed NDX/USD, Kromatika KROM/USD, DappRadar RADAR/USD, RAC RAC/USD, DFX Token DFX/USD and Paper PAPER/USD – each of which saw double-digit percentage gains on Tuesday.
The collective value of the wallet’s initial investment exceeded $570,000 at the time of writing, after seeing a 40% ROI in under 24 hours.
Why It Matters: Tokens named by Coinbase as potential candidates to be listed are known to rally significantly over the short term in a phenomenon that has come to be known as “The Coinbase effect.”
The Ethereum wallet’s curious purchases on Tuesday drove speculation that the buyer was a Coinbase insider with prior knowledge of the assets considered for listing.
As on-chain sleuth Zachxbt pointed out, this isn’t the first time a wallet made large purchases before a Coinbase listing announcement.
Price Action: According to data from Benzinga Pro, Coinbase shares closed 2.61% lower on Tuesday at a price of $149.85.
Photo courtesy: Coinbase
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