"Whales" in the crypto industry - how they affect the market

The concept of "whales" is familiar to all crypto traders and many of those who are just interested in cryptocurrency. In simple words, these are holders of large capitals who are able to significantly influence the price and move it in their direction. Hence the name - by the huge number of assets in comparison with other market participants

It is believed that “whales” often possess insider information, since it is possible to invest huge sums in a transaction only when there is great confidence in its success. That is why many small traders and investors make efforts to find "whale" deals and follow them. To do this, various analytical platforms, cluster analysis, as well as indicators such as open interest are used. And, for example, the Whale Alert service tracks large clearly "whale" transactions and reports them on Twitter.

There is another reason - when a huge mass of coins falls down or is loaded to increase the value of tokens, it is almost guaranteed to start moving in a given direction, simply pushing and sweeping away everything and everyone in its path. Therefore, simple and obvious logic confirms that it is really better to grasp the "whale" than to go against the current created by it.

Recently, there has been an opinion that the "whales" are beginning to lose their influence, as more and more coins are dispersed into the wallets of small and medium-sized investors. There is some truth in this, but almost 5% of all BTC in circulation are still on only 5 wallets, and in the case of Dogecoin, a single wallet owns 24% of DOGE. Just imagine what would happen if their owner decided to sell off his wealth overnight. This will lead to a truly epic collapse of the coin rate.

So who are these "whales"? Individuals, banks, companies, foundations? There are different options here. These can be centralized cryptocurrency exchanges, corporations (for example, Tesla has 43 thousand bitcoins), and governments. And even just ordinary people who at one time saved bitcoins, and did not buy pizza for them. What is worth one Satoshi Nakamoto, the mysterious creator of bitcoin. According to various estimates, a whole million BTC can be accumulated on his accounts. This is confirmed by the fact that 68% of the originally issued coins have never been in motion. Therefore, it is not difficult to guess where they may be.

And now let's give some concrete examples. In 2021, a flock of 8 whales, owning 70% of Shiba Inu tokens, pushed the price of the coin up, receiving almost 800% of the profit from their investments. Well, where without bitcoin. In 2017, only one BTC-whale provoked a record increase in the price of the coin to $ 20 thousand. And he did not lose out - in October 2020, he transferred a cryptocurrency worth more than $ 1.1 billion. This Bitcoin transaction is still considered one of the largest in history.

Thus, following the "whales" is a logical and quite profitable idea, however, it (however, like everything in the crypto market) should be treated with caution, without neglecting other aspects of analysis. And everything necessary to assess the market situation and effective trading is available in the GRIN4 ecosystem.

The GRIN4 ecosystem

We have created a bot to make money on crypto exchanges. You set the settings, and he trades 24/7. Manage all assets from one service: with your own hands or with the help of algorithmic trading. Anonymously. Simply. Stress-free.