Sometimes, when the price of BTC drops or rises, traders called "Bitcoin whales" are thought to pump or dump on the cryptocurrency market. Bitcoin whales are groups or individuals who hold huge amounts of BTC and are thought to manipulate market prices with huge buying and selling transactions. Although the market power of whales has decreased as the number of people who own Bitcoin has increased and as the value of the cryptocurrency market has increased over the years, whales remain important in this market. The movements of whales' cryptocurrencies are still in the news. In general, whales are dangerous as they are the largest fish in the ocean and feed on small sea creatures. Crypto whales are also famous for eating small traders, so to speak. The more a whale controls the total supply of a cryptocurrency, the larger its sphere of influence. For example, if a crypto whale owns 15% of link's total supply and is determined to sell these tokens, the price of LINK will surely be strongly affected. Summary • Whale bear • Whales can manipulate the market without trading BTC • How many cryptocurrencies do whales hold? • Is Tesla a Bitcoin whale? • Exchange-to-wallet transaction • Wallet-to-exchange transaction • How to track whales • Conclusion Whale bear In 2015, a few years after the invention of Bitcoin, a huge BTC whale hit the market. As we have said, in the past the effects of whales were very high in low-liquidity markets. The whale probably hoped that selling 30,000 BTC at $300 each would lower the price. Other investors, who took advantage of this sell order, bought the BTCs sold by the whale and continued to buy for a while. As a result, the price of Bitcoin rose to $400 in the same month. Whales can manipulate the market without trading BTC Bitcoin whales are also famous for bluffs. On cryptocurrency exchanges, buy and sell orders can be created at prices other than the spot price. Whales who want the price of Bitcoin to go up or down can create a so-called "wall" at a target price by placing a very heavy buy order on high-volume exchanges such as Binance, FTX, OKX or Coinbase. For example, placing a buy order of 3,000 BTC at a price below the spot price could create a support point for Bitcoin. If the whale is actually bluffing, it will cancel the buy order when the price of BTC approaches the order level.
How many cryptocurrencies do whales hold? Cryptocurrency whales often own huge amounts of cryptocurrencies. 85 Bitcoin wallets currently hold about 15% of the BTC in circulation. 8 million BTC, which corresponds to almost 42% of the BTC in circulation, are also found in the 2200 portfolios that hold the largest number of BTC. That's $185 billion. Whales love to buy and sell manipulative and volatile cryptocurrencies like Doge and Shiba Inu for short periods of time. While 27% of the total amount of Doge in circulation is held in a single portfolio, the 15 wallets that hold the largest number of Doges hold 50% of the offer in circulation. Is Tesla a Bitcoin Whale? Bitcoin was trading at $38,800 when Tesla announced on February 8, 2021 that it had purchased $1.5 billion worth of Bitcoin. After Tesla's public announcement, the price of Bitcoin gained nearly 50% in just 14 days and rose to $57,650. On July 21, 2022, Tesla announced data for the second quarter of 2022. According to this statement, Tesla has sold 75% of its stakes in BTC in the last three months. Although Tesla's statement caused an immediate drop in prices, the market then returned to the same level. Tesla is a Bitcoin whale, but Elon Musk's speculative posts about token memes, particularly Doge and Shiba Inu, have reduced Tesla's influence on the cryptocurrency market. Exchange-to-wallet transaction Bitcoin whales use "cold wallets" to store their funds, as this is a much safer and more secure solution. The large amount of cryptocurrencies sent by the exchange to the wallet indicates that the whale does not want to sell that cryptocurrency in the short term. If the cryptocurrency withdrawn into the wallet is a stablecoin, this is negative for the price of Bitcoin because the whale chose to stay in cash rather than buy Bitcoin. Wallet-to-exchange transaction This aspect is also important if a Bitcoin whale sends BTC from the wallet to the exchange. Crypto exchanges are the most popular platforms for trading cryptocurrencies. If a whale sends its BTCs to the exchange's wallet, it can be assumed that it intends to trade them in the short term. Again, the situation is different for stablecoins. Sending a large number of stablecoins to the exchange wallet suggests that a whale is preparing to buy another cryptocurrency. How to track whales Whale Alert is a Twitter account known to cryptocurrency enthusiasts. This account instantly shares large crypto transfers that take place within blockchains. If the sender or recipient has a known wallet owner, the account tags it in the tweet. If you have on-chain analytics skills and know how to use blockchain explorers, you can follow the big crypto whales and their transactions using explorers. Conclusion The cryptocurrency market does not yet have the controls and regulations to which traditional markets are subject. Although the market is less volatile than in the past, it is still volatile. Market manipulation is a common problem for whales. It is good to keep an eye on whales and follow their transactions, but you should not trade only on the basis of these transactions. You should always make your investment and trading decisions after doing sufficient research and using technical and fundamental analysis methods.