What is a Crypto Whale & Why do They Matter?
Crypto Whale is a large investor with significant holdings in cryptocurrencies and substantial transactions. Know more about what is a crypto...
Crypto Whale is a large investor with significant holdings in cryptocurrencies and substantial transactions. Know more about what is a crypto...
Whales are the largest animals (yup! Even larger than dinosaurs) that have ever existed on the planet. Some of the most ferocious beings, whales, rule the oceans. But what about whales in crypto? Does the term have a similar connotation? Or do whales in crypto carries a more figurative meaning? Let’s find out what are whales in crypto.
The crypto world also has an entity called the crypto whale. These entities are called ‘whales’ because of the size of their asset holdings. We can use the term ‘crypto whale’ for an entity that possesses a large number of cryptocurrencies, either in one wallet or multiple. Even though the measures used to describe a crypto whale are arbitrary, the impact of their actions is huge on the crypto market. Here, we will be talking about who and what is a crypto whale and its importance in the crypto world.
When it comes to the topic of whales in crypto, anonymity provides a protective shield to them. Crypto whales are entities that have crypto asset holdings larger than $10 million that may be spread across various cryptocurrencies or one. There is no significant limitation to having just one asset or multiple cryptocurrency investments. Since the amount of crypto assets handled by the entity is huge, no average person can be called a crypto whale. The anonymity accorded by blockchain networks also makes it hard for anyone to figure out who the whale is, let alone what plans they have for the future. Their actions in the crypto world largely impact the market performance, and we are obviously curious to learn more about ‘what is whales n crypto’ – a popular google search these days.
Some of the known crypto whales include names like Elon Musk of Tesla, Michel Saylor of MicroStrategy, Brian Armstrong of Coinbase, etc.
To understand the importance of crypto whales, we need to have a deeper understanding of the crypto market. Even though more and more retail investors are coming in, the crypto market is still hugely impacted by the actions of the whales. It is important to monitor the market moves of crypto whales as their actions can cause increased liquidity in the market or, suddenly, a reduction in the trade volumes. They are significant because following whales’ profitable moves can also prove to be great for other investors. They can orchestrate a crash or bull run with a dump or squeeze at their convenience.
Is a crypto whale dangerous? When it comes to the creatures in the sea, killer whales are considered to be one of the most dangerous predators. Similarly, whales in crypto can turn out to be dangerous for the market if they decide to be manipulative. Since they have huge holdings, crypto whales can put a large sell order and dump assets at a low price, essentially controlling supply and demand. This would cause a price decline, throwing the market into chaos until a crypto whale covers their sell order or the buyers manage to catch up. Further, this would mean the price is now where the whale wants it to be. And now they accumulate even more crypto at their desired prices.
When you are asked, what are whales in crypto, you cannot answer it without relating it to the huge investments that they have made. Thus, to become a crypto whale, you will have to start accumulating crypto assets and increasing your holdings. Either you have to be extremely rich to acquire large quantities in one go, or you can keep investing in the assets, and with time your holdings will make you a crypto whale. Taking the benefit of market crashes and buying the dip can be a resourceful move towards becoming a crypto whale.
So we know what is a whale in crypto, but how do they affect liquidity in the market? Whales personify the concentration of wealth in the crypto market, especially if they choose to simply hold onto the crypto. So many coins sitting unused without circulation naturally lowers liquidity for a crypto with only so many coins out in the market.
The biggest reason why crypto whales matter so much is that they make the market move on their profit terms. You can understand the control of crypto whales in the market by studying their investing pattern and the currency price chart. Thus, if a whale wishes to buy crypto at a low price, it will dump large quantities in the market. They manipulate the market by increasing or decreasing the volume of currencies in the market. They have immense control over the crypto market, and thus assessing your moves based on careful inspection of whale patterns is important.
As an investor, it is best always to be aware of the market movements of crypto whales. Here, we have tried to explain completely what is a crypto whale and how much of an influence they have over the market. Thus, it is up to the investors to assess the market situation and understand how the whales can bring about a bull or bear run. Crypto whales have holdings of over millions of dollars, and thus they have the power to control the crypto market freely.
Crypto whales like Tesla, Celsius, Voyager, etc., had sold their holdings during the recent market crash. Even the ‘Bitcoin Jesus’ Roger Ver had sold his holdings during the bear run. It all happened due to the sudden declining momentum in the market. However, some whales, such as MicroStrategy, kept accumulating more currencies at low prices. MicroStrategy recently sold its stocks to acquire $500 million worth of BTC.
Some of the biggest names among known crypto whales are Brian Armstrong, Changpeng Zhao (the CEO and founder of Binance), and the Winklevoss twins. These crypto whales each have a significant market influence as well.
The crypto market is all a game of demand and supply. You wouldn’t want to be the one standing against the wind. Thus, it is not the best decision to stand against the whales and sell while the market is longing and long while the whales dump their holdings.
A crypto whale is considered to be having crypto assets worth equal to or more than $10 million in their wallet. Crypto whales hold a lot of sway over the crypto markets and have the power to significantly manipulate the market and cause a shift in prices for this very reason.
Disclaimers: Opinions expressed in this publication are those of the author(s). They do not necessarily purport to reflect the opinions or views of Shardeum Foundation.
About the Author: Anuska is an independent freelance writer freshly exploring web3 and blockchain space. Her articles blend personal exploration with established editorial methods, and she’d love to hear your thoughts in the comments!
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