54% of 2018 ETH withdrawals from projects happened in December

As the ETH price continued to plummet, projects sold off close to 18% of their net position

3 Jan 2019 1 min read

As the bear market hit 2018 quite hard, Ether, the “fundraising” cryptocurrency, plummeted by close to 80% last year. Since projects have to pay their daily operating expenses in fiat - not in crypto - managing cash treasury is vital to ensure sustainable development.

1.5 million ETH withdrawn in 2018

According to diar’s ETH treasury balance, which tracks the Ether holdings of 100 odd ICO projects, the major blockchain projects on Ethereum had a balance of 4.6 mn ETH at the beginning of the year.

On the first of January, the holdings accounted for over $3.4 bn when ETH was priced at $755. By the end of 2018, these projects saw their balance drop by over 87.8%, to $424 mn due to the falling price of Ether and their substantial sell-off.

November and December withdrawals account for close to 25% of initial balance

While ICO projects sold roughly 34% of their initial 2018 balance in 12 months, at a monthly average rate of 2.45% but a huge chunk of it occurred in the last couple of months.

Month-on-Month ETH ICO Treasure Net Withdrawals

ETH liquidation from ICO projects took another level by November, when price fell below $200 levels. The drop must have triggered sells to avoid cash flow complication in case ETH dips even further.

Which is exactly what happened in December: ETH further dipped to below $100 levels, a 50% decrease in only a matter of weeks.

Naturally, projects decreased their exposition to cryptocurrencies due to immense price volatility. December witnessed a withdraw of 18% of the initial 2018 January ETH balance and represents 54% of all the withdrawals from Diar’s sample.

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