Whale spotted: How whales determine the price of the crypto market
Did you know that the largest wallet contains over 168,791 Bitcoins? To put it in perspective, it’s worth over $ 10,645,817,161 as of April 14, 2021. Another dormant Bitcoin address has over 80,000 BTC, worth over $ 750 million.
The âcrypto whalesâ are among the most critical players in the crypto market. A crypto whale is an investor with significant capital. They can move a lot more numbers than individual traders because these entities are usually institutional investors.
It is commonly believed that crypto whales control the price of Bitcoin and other cryptocurrencies. This may be true to some extent, but the truth is a bit more complex.
However, it is still worth keeping an eye out for these players as they can provide valuable insight into the future of crypto. For example, a recent crypto-whale that focused on may have dramatically changed its future.
A few weeks ago, Born2Invest announced the possible return of Ripple as it headed towards the $ 1 mark. Today, Ripple breaks the $ 1.7 mark, and that’s a big event since Ripple’s last controversy.
Nonetheless, we need to focus on the whale behind the article. Decacorn, a fintech company, transferred 746 million XRP through Ripple’s ledger. It is an understatement to say that the transaction has caught the attention of investors.
What was the size of the movement?
At the time of the report, the move was worth more than $ 407 million. Today, after XRP’s value increased more than three times, it is a transaction of almost $ 1.3 million. The transaction took place between two of Decacorn’s crypto wallets.
Since the lawsuit, the SEC has complained that Chris Larsen, the co-founder of Ripple, continues to trade XRP.
Naturally, we cannot say that this transaction was responsible for the growth of Ripple. However, seeing crypto whales still interested in cryptocurrency builds confidence in XRP.
Ripple: go ahead
About a month after the SEC trial, Ripple shows no signs of stopping. Initial fears about XRP’s ability to weather this setback have subsided. Since then, the company has signed more than a dozen contracts with various financial institutions. As of this writing, Ripple has hit the $ 1.8 mark and is showing no signs of stopping.
The main advantage of Ripple is that it doesn’t try to be another cryptocurrency. It is a leading player in the acceptance of cryptocurrencies by traditional institutions.
Why Should You Care About Crypto Whales?
Most traders fall for the idea that they cannot learn from crypto whales. After all, how could they learn from someone with so many more possibilities and opportunities? This is a big mistake.
Savvy investors understand why it’s best to keep an eye on them. First of all, they highlight promising investment opportunities. Moreover, their holdings and decisions can play a crucial role in the supply and demand dynamics of any cryptocurrency.
Learn from the experts
Crypto-whales have accumulated their capital through efficient investment decisions. These are great references for any trader interested in becoming a better investor. Since they are more likely to spot profitable investments, their movements can be important signals for traders.
Individual traders should aim to jump into trends while they are “fresh” as that means bigger profits. The cash flow and movements of the crypto whales offer great insight, which you can use to tailor your strategies for better results.
Additionally, crypto-whales have a notable influence in the market. Most traders think they are controlling prices because their capital allows them to inflate and deflate investment assets as they see fit. It doesn’t cover everything they do.
Many traders keep their eyes on crypto whales because they perceive them as price changers. The following is generally more powerful than the capital of the whales; following their example, the demand for any cryptocurrency is increasing and this is where the real price changes come from.
Do Crypto Whales Drive Prices?
Nonetheless, it would be incorrect to say that crypto whales dictate crypto prices. Crypto trading requires multiple people and unique entities cannot change the prices. Crypto whales could, in theory, do this, but it’s an unnecessary risk.
That’s not to say crypto whales aren’t influencing the crypto market. They don’t control prices at will.
On the reverse
- Even gigantic transactions can do little to influence the price of a cryptocurrency in the long run. The main advantage of Ripple is its legitimacy and influence.
- If the transaction was between two of the whale’s wallets, the increase in demand could be artificial because it did not come from a natural desire in the market.
- If so, Ripple’s price could drop as the âbubbleâ bursts. On the other hand, the market has probably already adapted to the new stock, thus boosting confidence.