Certainly, the crypto industry is enveloped with scores of terminologies. One of them is “crypto whales.” The term crypto whales is used to describe big investors within the industry. These are individuals or corporate institutions with a large amount of crypto assets. This thus gives them the power to influence the market. The implication is that whatever decision they make as regards their investments usually impact the situations in the crypto market. They can easily cause price fluctuations either by purchasing a large portion of a particular crypto project or by selling their large holdings.
By virtue of this status, crypto whales are mostly seen as influencers. Most of those with little holdings look up to them and monitor their decisions everytime. Although, we advise that these investors conduct their own personal research on whatever financial decision they intend to make and not rely on the perspectives of crypto whales alone. The fact that these whales holds a significant portion of a token does not mean they have an insightful knowledge of the market.
It is worthy of note that there is no specific amount required to become a whale. This means the amount to becoming a whale is not fixed. In most cases, it relies on the crypto project itself. But, one important fact is that one must hold a significant percentage of the token’s total supply.
For instance, if an investors holds $3 billion worth of XRP is a whale. While, someone who holds $3 billion worth of BTC is not a crypto whale. Although, the two investors boast of $3 billion investments in the crypto projects each, the activities of the first investor has the capacity to impact the market more. This is because of the big difference between the market cap of BTC and XRP. So it is very important for people to use the term with caution.
How to Identify Crypto Whales
At times, it can be a daunting task to identify a crypto whale. This is due to their preference for remaining unknown. However, the transparent and immutable nature of the blockchain has made it quite easy. There are some pointers that can help identify a crypto whale.
A prominent way of identifying a whale is by using a blockchain explorer to monitor voluminous transactions. A large amount of transactions can indicate that a whale is active. Also, analyzing trading patterns is a good way of identifying a whale. Whales are prominent for their large stake that can trigger a free fall or upward price movement. So, analyzing unsual and voluminous trading pattern can help identify a Whale.
Lastly, the social media can as well help in identifying crypto whales. Most times, some Whales are vocal about their perspective regarding crypto assets, investment strategies, and market trends on Social media platforms. For the crypto space, Twitter has been a good ground for virtual assets enthusiasts to gather. Therefore, keeping a close tab on comments about the aforementioned issues can be helpful.
Benefits of identifying a Crypto Whale
Meanwhile, investors can keep close tabs on crypto whales to understand more about the dynamics of the crypto market. Monitoring their activities can aid investors to have an insight into a possible market trend. For instance, a whale can either contribute to the upturn or downturn of a crypto asset. Prior to their move into the market, they can instigate either of the two. An investor who’s watching the activities of a certain Whale can as well pull a move in that regard to favoring their holdings.
Due to their sizeable holdings, crypto whales are more likely to have access to top classified information than a regular investor. Leveraging on this, investors can gain access to this information from a the Whale. Therefore, placing them at an advantage of benefiting from this information as well. Nevertheless, investors should endeavor to embark on personal research before making any trading decision. Limiting their source of information or market research to Whales can be costly at times. However, merging personal research and tips from Whales can help guide a trader in making good decisions.
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