SharpLink CIO Matthew Sheffield has addressed a previous report that made the rounds after blockchain analytics platform Arkham Intelligence wrongly reported that a wallet linked to SharpLink Gaming had moved considerable Ethereum to an exchange.
The company, which made its name for its aggressive Ethereum (ETH) accumulation strategy, would’ve seen the implication of sales raise questions about the health of its business and its liquidity levels. In the post shared by Lookonchain, based on data it got from Arkham, Sharplink had redeemed 5,284 ETH and sent 4,364 ETH to OKX.
Arkham clarifies AI wallet labelling mistake in Sharplink update
All that attention translated into widespread speculation, with the consensus leaning towards SharpLink initiating a major ETH sell-off. It did not help matters that Ethereum’s price had been seeing volatility, and the unrealized losses on the company holdings kept mounting. What followed the news was short-term market jitters.
However, all speculations ended after Sheffield implied in a tweet that the wallet does not belong to SharpLink and that it was incorrectly tagged on Arkham’s platform. In response to his post, Arkham revealed that the “label is a prediction from our AI model, not an Arkham-verified label. AI predicted labels are indicated by the purple outline and question mark.”
The post noted that the Arkham-verified SharpLink wallets appear under the SharpLink entity on Arkham and that the wallet in question is not one of those. Sheffield expressed appreciation for the clarification from Arkham while confirming that the wallet no longer reflects the SharpLink label. “Making predictions on wallet owners is an interesting problem,” he added.
He highlighted that making probabilistic assumptions is never going to be 100% accurate, but noted that it is generally an effective tagging algorithm from what he has experienced. Sheffield added that he was a big fan of the Arkham product. The incident briefly put some sell pressure on ETH prices and the SBET stock, which dipped up to 8% on November 6. However, the market has since corrected as sentiments stabilize.
For now, the firm’s Ether holdings are second only to Bitmine Immersion Technologies (BMNR), which currently has 3.40 million ETH in its treasury. It has achieved this by using equity issuances to fund purchases in a self-reinforcing cycle during bull markets. Even though the strategy has worked out so far, it continues to attract mixed reviews with critics grounding their argument in factors like over-leverage and volatility exposure.
