With CDC sending 2M Moons to themselves from Gate IO, that means one of a two things. Either CDC Customers purchased exactly 2M Moons at markup of 15%+ and limited buying ability (highly unlikely) or CDC purchased excess Moons on the market, in order to sell them higher, later.
The second is a very high risk strategy and would assume that CDC expects the price of Moons to go up. Thus further profiting on the difference between buy price and sell price. For that reason you may be immediately inclined to dismiss it – but by looking at CDC exchange wallets later in this post you can see CDC did exactly that with Shiba Inu.
Prior to the leadup of the Shiba Inu ATH, CDC purchased a ton of Shib from Binance OTC before the price went up and then sold that to customers at a markup as the price rose.
Exploring CDC Shiba Wallets
If we look at the CDC wallets that hold Shiba Inu, CDC, CDC2, CDC3, CDC5.
On May. 09th 2021, Crypto.com first listed Shiba Inu, ~821 days ago. CDC wallet first recieved Shib ~821 days ago. CDC2 first recieved Shib ~824 days ago – CDC3 first recieved Shib ~820 days ago, and CDC5 first recieved Shib ~518 days ago.
- CDC appears to be the initial incoming hot wallet for Shib, but has since been moved to more of a cold storage state.
- CDC2 appears to be the current hot wallet for outgoing transactions.
- CDC3 appears to be the wallet that was used to store Shib purchased OTC (not inbound transfers from customers) and regularly used to supply the CDC2 withdrawal wallet.
- CDC5 appears to have started as a cold storage wallet for inbound user funds from CDC (the original incoming hot wallet) but has since become the hot wallet for incoming transactions – and also transfers to CDC2 the outgoing wallet.
Analyzing the OTC Shiba Wallet
So the CDC, CDC2, and CDC5 are all incoming/outgoing hot wallets or cold storage wallets and handles user funds transferred in or out.
That only leaves CDC3 which really needs to be investigated, from the middle of May to end of August this wallet was being loaded with OTC buys of Shiba mainly from Binance. Nothing about this fact is suspicious until you look at when they stopped buying Shiba OTC – August 28th.
At that point they were only sending their already acquired OTC Shiba to their withdrawal wallet CDC2 likely because they had an excess of Shiba from their previous buys. They then purchased a very small amount again on Oct. 06th and 07th 2021 and again didn't purchase more until Nov. 03rd where they once again purchase a small amount from Binance after the Shiba ATH.
This shows CDC bought a ton of OTC Shiba long before it spiked in October of 2021. So the entire time Shiba Inu was rising from Aug. 28th 2021 and peaked on Oct 27th 2021 – CDC was offloading the Shiba it had previously purchased at up to a 12x profit on retail buying through CDC.
Analyzing the findings:
CDC describes themselves as more of a brokerage company that purchases crypto when their users do. However given the fact that CDC loaded up on Shiba when the price was stagnant months before the rise and didn't purchase more OTC leading up to or after the Shiba ATH in October of 2021. We can definitively say – Crypto.com took a calculated risk and bought a ton of Shiba early and sold Shiba a few months after it was purchased at a huge markup directly to their users.
What CDC's past gamble on Shiba likely mean for Moons:
With CDC transferring 2M Moons to themselves – it means one of a few things.
- CDC Customers purchased exactly 2M Moons with limited buys and huge fees
- CDC thinks the price of Moons will likely go up, and are loading up so they can sell to their customers later when it's more expensive just like they did with Shiba.
- CDC thinks the price of Moons will likely go up and would like to be a brokerage selling marked up Moons to other Exchanges that are potentially looking for their own Moon collateral OTC. Similar to what Binance did to CDC by selling marked up Shiba to them.
Quite frankly, any of these reasons are Bullish for Moons