Bruce Dias 
Numerous factors affect the cryptocurrency market, from supply and demand to media coverage and ongoing regulations. Investors must consider them all when creating their strategies and adjusting portfolios because being up-to-date with these changing elements is vital for gathering crypto value and minimizing risks.
However, one more influencing aspect is usually underestimated ―whales. The term is solely used in the cryptocurrency community to describe an individual or entity holding a great deal of coins. Given how much they own, whales have the power to influence the market dynamics. Satoshi Nakamoto, the creator of Bitcoin, is one of the biggest whales on the network, but we can also recall significant whales that are institutional, such as Tesla.
These entities can change the BTC price USD unwillingly, so investors should follow their strategy movements and adapt to maintain a stable flow of investment. Here’s why.
How Can Crypto Whales Affect Value On The Market?
According to BitInfoCharts, only three Bitcoin wallets own almost 30% of circulating coins, while the top 110 hold more than 15% of the total supply. Since they’re so strong, communities monitor these whales closely when making a significant change in their investments, especially on the X social media platform.
Whales can lower or increase a cryptocurrency’s liquidity. When they choose not to leverage the coins from their wallets, whales decrease a coin’s liquidity, such as Bitcoin, which disadvantages regular investors because they’ll give significant price oscillations.
However, whales can also boost crypto liquidity when they perform a massive transaction. This is the best time for investors to buy, as Bitcoin prices are pressured downwards.
Reading Whale Intentions
Whales are important for investors because they can help predict price movements, which can generate profit. Yet, reading into their actions is not straightforward because moving their assets does not always imply selling them.
Some whales prefer selling their cryptocurrencies in small batches over a certain period to avoid being in the spotlight, but this confuses users because the prices are going up and down suddenly. Hence, investors must check the number and value of whales’ transactions so they know whether the upcoming period will be challenging or lucrative.
Can You Become A Crypto Whale?
Defining the items of becoming a crypto whale isn’t clearly established. Still, we’re sure that you must own a considerable number of Bitcoins in order to have the ability to influence the market. Famous whales, like Michael Saylor or Tyler and Cameron Winklevoss, are staple whales to check out, but many unknown whales transfer millions of dollars in one transaction.
Besides institutional whales, you can become a retail whale if you strategically invest in retail businesses or an insider whale if you’re among the first investors in a successful crypto project. Still, you must invest a lot of time researching low-cost coins, holding strategies, and diversification tips. Interestingly enough, you don’t need a fortune to become a whale on your own. You can start with as little as $100 and pile up on your investments.
3 Reasons For Becoming A Crypto Whale
While being a crypto investor is already challenging alone, becoming a whale would bring you considerable benefits as a member of the community. In time, you can earn financial independence based on the wealth-building up progressively, in addition to new investment opportunities.
On the other hand, you become part of the blockchain integration revolution as you contribute to its growth and adoption within traditional systems. Some global governments are already leveraging blockchain’s benefits, considering it’s the starting point towards the Web3 world.
Finally, as a whale, you’re making a difference among investors through supporting power to emerging projects and initiatives on the crypto market. Investing in cryptocurrencies helps grow the industry and encourages developers to improve their projects.
But What If You Prefer To Be A Whale Watcher Instead?
Becoming a crypto whale puts considerable pressure on one’s ability to sustain themselves while accumulating more and more Bitcoins. Hence, it’s not that easy to achieve being a successful one without risking your assets.
So, if you want to stick to being a whale watcher while managing your own portfolio, you should only rely on the blockchain to provide you with the information required. Luckily, blockchain transparency and immutability allow anyone on the public ledger to view the history of every transaction performed. Therefore, you can easily monitor individual whale wallets, especially since there are plenty of tools, such as a blockchain explorer, available for investor use.
The use of blockchain data will tell you if a whale wants to sell because it’s usually moving all its holdings from a wallet to an exchange. The aftermath is a potential price drop. On the other hand, whales who move their coins from exchanges into their wallets will most likely hold them for longer to gain long-term value.
Why Are Whale Holdings Declining?
Recent data shows that in the past years, whale holdings have become less frequent, and several factors triggered this dynamic, such as the following:
- Whales can split holdings across numerous participants to avoid market manipulation;
- Whales prefer contributing to a high-liquid network;
- Retail investors are increasingly approaching the whale system;
- The regulatory landscape limits whales to holding infinite crypto positions;
- Geopolitical and macroeconomic factors influence whales’ willingness to hold;
Some consider that regulation should focus more on whales instead of the actual tokens because they affect market prices and volatility more than supply and demand. However, this would impose considerable limits on individuals’ ability to invest in crypto in an environment that should be censorship-free. Therefore, regulation should assess safety, taxation, and fairness more than anything else.
What’s Your Take On Bitcoin Whales?
Cryptocurrency whales are known for holding significant amounts of crypto assets, and their powerful portfolios can affect the market dynamic. For example, if a whale plans to sell its crypto, prices will likely decline as the Bitcoin price is pushed downwards. What’s great about whales is that they’re clearly visible on the blockchain, so people can view their transactions and adjust their strategies based on more prominent players on the market.
