DAT Panic Dumps 73,000 ETH, India’s Crypto Tax Remains Unchanged – Asia Express
By Yohan Yun – 2 February 2026
Quick summary
- An on‑chain “panic” sale by a major Ethereum holder, identified as Trend Research (also referenced as DAT in some analyst circles), off‑loaded roughly 73 000 ETH (≈ $160 million at current prices) to repay leveraged positions on the Aave protocol.
- India’s 2026 Union Budget offered no relief for the country’s already‑stringent cryptocurrency tax regime, leaving the 30 % flat tax and 1 % tax‑deducted‑at‑source (TDS) rules intact.
- In the same week, regulators in South Korea announced a new AI‑driven system to spot market manipulation, and Hong‑Kong’s monetary authority moved its stable‑coin licensing timetable forward to March.
1. Emergency ETH dump by Trend Research (DAT)
What happened
During the early hours of 2 February, on‑chain analytics revealed a series of large ETH sales executed on Binance. The seller, an institutional entity known as Trend Research—linked to Hong‑Kong venture founder Jack Yi (also called Yi Lihua)—was seen moving about 73 000 ETH from its wallet.
The liquidation appears to be a forced repayment of stable‑coin loans borrowed from Aave, which the firm originally used as leverage to amplify its ETH accumulation strategy. The position had peaked at roughly 651 000 ETH (wrapped) in mid‑January, but by the time of the dump it had already slipped to just under 580 000 ETH.
Why the dump matters
- Leverage risk – Trend Research’s model involved buying ETH on centralized exchanges, using the tokens as collateral to borrow stablecoins, and then repurchasing more ETH. A sustained price decline below $2 200 per ETH put the collateral‑to‑debt ratio under pressure, prompting the emergency sell‑off.
- Market impact – While the 73 000 ETH sold represents only ~11 % of the entity’s remaining holdings, the speed of execution (multiple transactions within a few minutes) contributed to a short‑term dip in ETH’s price, reinforcing the narrative of “whale panic” that often amplifies volatility.
- Transparency gap – Trend Research is a private vehicle, so its holdings are not reflected in public corporate treasury disclosures. This limits investors’ ability to gauge concentration risk in the broader ecosystem, especially when large, opaque positions unwind.
Outlook
Analysts expect the firm to continue deleveraging by trimming additional ETH holdings or by liquidating other assets to bring its loan‑to‑value ratio back within safe limits. The episode underscores the broader fragility of leveraged strategies in a market that has entered a prolonged correction phase.
2. India’s crypto‑tax policy stays hard‑line
Legislative backdrop
The 2026 Union Budget, presented by Finance Minister Nirmala Sitharaman, did not contain any proposals to amend the country’s cryptocurrency tax framework. India continues to levy a flat 30 % tax on crypto gains, with limited ability to offset losses against other income streams.
A particularly contentious element remains the 1 % tax‑deducted‑at‑source (TDS) on all crypto transactions, regardless of whether a profit has been realized. This rule, introduced in 2022, obliges exchanges to withhold tax at the point of trade, effectively front‑loading tax obligations for traders.
Industry reaction
Crypto exchanges, trading platforms, and industry bodies have repeatedly lobbied for a reduction of the TDS rate to 0.1 %, arguing that the current level hampers liquidity, discourages participation, and pushes talent abroad. Their pleas were again rebuffed, with the government citing revenue‑collection priorities.
The budget speech did, however, introduce new penalty provisions:
- Daily fines of ₹200 for late filing of required statements.
- A one‑off fine of ₹50 000 for submitting inaccurate information or failing to correct identified errors.
These measures aim to improve compliance but add further cost pressures on market participants.
Potential consequences
- Reduced on‑ramp activity – The continued high tax burden may deter new entrants and push existing traders toward offshore platforms that operate outside Indian jurisdiction.
- Talent flight – Skilled developers and crypto‑related professionals could seek opportunities in more tax‑friendly jurisdictions, potentially slowing domestic innovation.
- Regulatory clarity – While the lack of reform may be seen as a signal of policy stability, the added penalties suggest the government is tightening enforcement, which could increase compliance costs for exchange operators.
3. Regional regulatory developments (Asia Express)
| Country | Development | Key Points |
|---|---|---|
| South Korea | AI‑driven market‑manipulation detection | The Financial Supervisory Service upgraded its VISTA platform, enabling real‑time identification of suspicious trading patterns down to the second. |
| Hong Kong | Stable‑coin licensing timeline | The HKMA announced that, pending swift responses from applicants, licensing decisions could be issued by March 2026, accelerating the rollout of its stable‑coin framework. |
These moves illustrate a broader trend across Asia: regulators are increasingly leveraging technology to monitor markets while simultaneously preparing frameworks to integrate emerging digital assets.
4. Analysis & key takeaways
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Leverage vulnerability: The Trend Research/DAT sell‑off highlights how quickly leveraged positions can become untenable when price support erodes. Institutional participants must maintain robust risk controls, especially in a market where ETH has breached the $2 200 threshold.
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Market‑wide ripple effects: Even though the dumped ETH represents a modest slice of total supply, large‑scale, rapid sales can exacerbate price swings and feed negative sentiment, potentially triggering further liquidations among other leveraged actors.
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India’s tax rigidity: The unchanged 30 % flat tax and 1 % TDS continue to be among the world’s most punitive crypto regimes. Without reform, India risks alienating both investors and innovators, potentially ceding market share to friendlier jurisdictions.
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Regulatory tech escalation: South Korea’s adoption of AI for manipulation detection signals a shift toward proactive, data‑driven supervision. Other Asian regulators may follow suit, raising the bar for compliance and surveillance.
- Stable‑coin licensing momentum: Hong Kong’s accelerated licensing schedule may set a precedent for other jurisdictions seeking to bring stable‑coins into regulated finance, potentially fostering greater institutional adoption in the region.
Bottom line: The twin headlines of a panic ETH dump and a steadfast Indian tax policy underscore the divergent forces shaping Asia’s crypto landscape—volatile market dynamics on one side, and entrenched regulatory frameworks on the other. Market participants must navigate both the financial risks of leveraged exposure and the compliance challenges posed by stringent tax regimes, while keeping an eye on emerging supervisory tools that could reshape market behavior in the months ahead.
Source: https://cointelegraph.com/magazine/eth-whale-panics-india-crypto-tax-asia-express/?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
