Ethereum price declines as Coinbase ETH liquidity staking platform sees mass withdrawals


  • Coinbase registered its second-largest daily withdrawal of cbETH on Tuesday. 
  • The exchange is one of the most popular label entities for Ethereum liquidity staking. 
  • Ethereum price fell around 2%, trading at $1,836.82 at the time of writing.

The US Securities and Exchange Commission’s (SEC) crackdown on Coinbase led to  mass withdrawals of Coinbase wrapped staked Ether (cbETH) since Tuesday, acting as a bearish catalyst for the asset’s price. 

Also read: Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Wait-and-see approach seems prudent

Coinbase sees elevated redemptions of its Ethereum staking token

Coinbase, one of the largest cryptocurrency exchanges, noted a spike in redemption of its liquidity staking token cbETH after the US financial regulator filed a lawsuit against the crypto exchange for allegedly operating as an unregistered securities exchange. 

cbETH redemptions on June 6

cbETH redemptions on June 6

Based on data from crypto intelligence tracker Dune Analytics, 35,810 cbETH were redeemed in the past two days. Of these, 27,280 cbETH tokens were redeemed on June 6, marking the second largest single-day amount ever.

Coinbase said it will not stop staking services despite the SEC’s lawsuit. Still, the withdrawal of cbETH is likely to act as a bearish catalyst for Ethereum price since Coinbase is one of the largest entities for ETH liquidity staking.

Implications for Ethereum price 

Ethereum, the second-largest altcoin in the crypto ecosystem, saw a V-shaped reversal a day after the SEC filed a lawsuit against Binance. However, the token’s price has continued to decline since then, wiping out its recovery gains.

Ethereum price chart

Ethereum price chart

At the time of writing, ETH trades at $1,836.82, according to CoinGecko data. The altcoin accumulates  2.2% losses since Wednesday, and mass withdrawals from its top liquidity staking services could increase the pressure on the asset, sending it further down in the short term. 


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Ripple's XRP holds symmetrical triangle support as SEC acknowledges Bitwise XRP ETF filings

Ripple's XRP holds symmetrical triangle support as SEC acknowledges Bitwise XRP ETF filings

Ripple's XRP is down 3% on Tuesday despite the Securities and Exchange Commission (SEC) acknowledgment of Bitwise XRP ETF. Unchained Crypto noted that XRP ETF could underperform due to key fundamental issues.

More Ripple News
Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC, ETH and XRP could decline on FTX repayments pressure

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC, ETH and XRP could decline on FTX repayments pressure

Bitcoin (BTC) price has been consolidating between $94,000 and $100,000 for two weeks. Ethereum (ETH) and Ripple (XRP) faced a pullback earlier this week. BTC, ETH and XRP prices could decline further as FTX repayments could raise selling pressure.

More Cryptocurrencies News
Bitcoin stretches losses as CME premiums dip, Strategy aims to purchase $2 billion worth of BTC

Bitcoin stretches losses as CME premiums dip, Strategy aims to purchase $2 billion worth of BTC

Bitcoin (BTC) continued its downward trend on Tuesday as K33 Research's weekly report indicated growing declines in BTC CME premium and yields. BTC has shown a directionless movement since the presidential election, which suggests waning interest among investors.

More Bitcoin News
How will Dogecoin price react to Elon Musk investigating the US SEC?

How will Dogecoin price react to Elon Musk investigating the US SEC?

Dogecoin price hit $0.25 on Tuesday, plunging 10% in 48 hours as the market reacted to regulatory squabbles between Elon Musk-led D.O.G.E and the US SEC.

More Dogecoin News
Bitcoin: BTC consolidates before a big move

Bitcoin: BTC consolidates before a big move

Bitcoin price has been consolidating between $94,000 and $100,000 for the last ten days. US Bitcoin spot ETF data recorded a total net outflow of $650.80 million until Thursday.

Read full analysis
The Best Brokers of the Year

The Best Brokers of the Year

SPONSORED Explore top-quality choices worldwide and locally. Compare key features like spreads, leverage, and platforms. Find the right broker for your needs, whether trading CFDs, Forex pairs like EUR/USD, or commodities like Gold.

Read More

BTC

ETH

XRP