What happened
Bitfinex's UNUS SED LEO Token (LEO) is giving up some ground today after posting huge gains Tuesday. The cryptocurrency's token price was down roughly 9.3% over the previous 24-hour period as of 3:15 p.m. ET Wednesday. Meanwhile, Bitcoin (BTC 0.32%) was up roughly 3.3%, and Ethereum's ether token was up roughly 6.3%.
LEO Token posted huge gains Tuesday following news that the U.S. government had seized roughly $3.6 billion worth of Bitcoin that had been stolen from the Bitfinex exchange in 2016, but the token is now seeing some sell-offs. Even with today's pullback, LEO is up roughly 62.5% over the last week of trading.
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So what
News hit Tuesday that Department of Justice (DOJ) officials had seized roughly 94,000 Bitcoin tokens connected to a 2016 hack of the Bitfinex exchange. It's said to be the largest financial seizure in the department's history, and the recovery has been a major positive catalyst for Bitfinex's cryptocurrency.
LEO surged to an all-time high of $8.14 per token yesterday, and the cryptocurrency is now down roughly 18% from that price point following today's sell-off. The token is losing ground today despite the broader cryptocurrency market enjoying bullish momentum, but it's not surprising to see it lose some ground on the heels of yesterday's explosive gains.
Now what
UNUS SED LEO is a cryptocurrency used to carry out transactions on Bitfinex, and investors see the DOJ seizure being a boon for its valuation. Approximately 120,000 Bitcoin tokens were stolen in a 2016 hack of the Bitfinex exchange, and the DOJ may have now recovered about 78% of that haul.
Bitfinex had previously pledged to spend 80% of any amount recovered to buy, and then burn, the UNUS SED LEO token. Burning tokens will reduce the total amount of the cryptocurrency in circulation and likely increase its value in the process.
UNUS LEO Token now has a market capitalization of roughly $6.4 billion, and it ranks as the 29th largest cryptocurrency by valuation.