Whales are the mighty in the decentralized cryptocurrency world. Ironically. These are the wallets that carry huge sums of digital assets. Roughly 1000 of these whales carry 40% of the market. These whales are basically early investors and hedge funds that adopted digital assets when all others were busy in merrymaking.
Only yesterday, 3,310 BTC (12,030,062 USD) were transferred between exchanges and unknown wallets in two different episodes. If these make into the markets, it could drop the BTC value significantly, even if for a short time. This is how whales could manipulate the market.
According to Flipside Crypto, since last October, a large number of whales who hadn’t touched their Bitcoins for between six months and two and a half years began moving their assets. The activity has continued since then and now, the wallets that have been active in the last 30 days hold 60 percent of the circulating supply.
Below are the Top 10 dormant Bitcoin holders for 2 years. Notice the insane amount of cash these wallets store.
Imagine if these wallet holders decide one day to dump all of their assets into the market. What a nightmare it would be. The prices will crash to the floor with recovery getting difficult and difficult as the sentiment would plummet to the floor too. Good news is that they won’t. For gaining profit, they’ll have to drip the assets into hundreds and lesser units slowly into the market without anyone noticing. Psyche countering psyche. Classic.
In end of August last year, a whale movement of around 50,000 BTC (worth around $320 million at that time) in 50 transactions fuelled a sell-off that caused a 15% drop in prices. The reason = speculation that the whale was moving in for a sell.
That’s how flimsy the market is and that’s how strong volatility factor in this sphere is. Hodl on!
Photo by Sandra Seitamaa on Unsplash