Aster Slumps 19% – How $30M CZ Sell-off Rumors Triggered Market Panic

Aster Dipped 19% Amid Rumors of Binance CZ’s Sell-off

Recent rumors regarding a significant sell-off by Binance founder Changpeng Zhao (CZ) of Aster [ASTER] tokens led to a sharp price drop, causing panic among investors. However, subsequent clarifications have sparked a potential recovery. This article discusses the events surrounding the sell-off rumors and the market's reaction.

Key Takeaways

Rumors about Binance founder CZ selling 35 million ASTER tokens ignited panic and triggered aggressive selling.
Disputed claims surrounding the sell-off and renewed buyer interest may help absorb the selling pressure and promote a recovery.
Aster [ASTER] fell 19%, dropping from $1.05 to a 2-month low of $0.85, but temporarily rebounded to $0.93. Currently, Aster is trading at $0.92, reflecting a 7.92% decrease for the day and an 18% decline for the week.

Understanding the Drop in Aster’s Price

Rumors of Binance Founder CZ’s Sell-off

The cryptocurrency community was abuzz as rumors circulated that Binance's founder Changpeng Zhao (CZ) had sold his Aster holdings. Reports suggested that a wallet linked to CZ had transferred 35 million Aster tokens, valued at approximately $30.42 million. This information triggered a panic sell among investors as the price of Aster plummeted.

However, confidence returned to the market when platforms like Lookonchain refuted these claims. They indicated that the $34.53 million transfer involving 31.84 million ASTER was conducted between Binance’s hot wallets and was unrelated to CZ’s wallet.

Aster Faces Intense Spot Selling Pressure

The rumors about CZ's sell-off triggered a wave of panic, leading to aggressive selling by other investors. According to Coinalyze, Aster's sell volume reached 107 million in just 24 hours, while buy volume was only 103 million.

Aster buy sell volume
Source: Coinalyze

This resulted in a negative Buy Sell Delta of -4 million, indicating a period of intense selling. Additionally, major holders of Aster also increased their selling, offloading 35.6 million tokens.

Aster top holders
Source: Nansen

Historically, when selling pressure surges among market participants, it often leads to continued downward price movement.

Futures Liquidations Reach a Two-Week High

As the market declined, many investors in the Futures market were either forced to liquidate or chose to close their positions. Data from CoinGlass reveals that Futures liquidations reached a two-week high of $8.5 million, with long positions amounting to $8.2 million being liquidated.

Aster Liquidations
Source: CoinGlass

Additionally, Futures outflows rose to $552 million, compared to inflows of $509 million, indicating a bearish trend where the netflow dipped to -$42 million, signifying increased selling activity.

Aster futures flows
Source: CoinGlass

Is a Sustainable Recovery Possible?

According to AMBCrypto, after the panic sell-off stemming from the rumors of Binance CZ's actions, Aster saw a notable decline. The Stochastic RSI fell from 26 to 12, signaling a growing dominance of sellers. Furthermore, the Relative Vigor Index crossed into bearish territory, declining to -0.138, suggesting a heightened downward momentum.

Aster RVGI & Stoch
Source: TradingView

Typically, when these technical indicators reach such low levels, it points towards a strong bearish momentum, likely continuing the trend. Consequently, if sellers maintain their dominance, Aster is expected to find support around the $0.9 mark. Conversely, if buyers regain control and drive up demand, they may absorb the ongoing selling pressure.

This could support the recovery trend initiated post-rumor clarification, enabling Aster to target the resistance level of $1 once more.