What is Crypto Whale? A Beginner’s Guide

A crypto whale is considered a major force that can impact supply and demand, capable of triggering both price increases and decreases. The crypto whales, despite the decentralized nature of cryptocurrency, reveal that it has a significant influence on the crypto market. In this article, we discuss the role of crypto whales in cryptomarkets and how important it is to know about them.

What Is a Crypto Whale?

A crypto whale is an institution or entity that holds a large amount of cryptocurrency and can influence the market. Here, if the word “ocean “ is given as a metaphor to the global crypto market, which contains small and numerous traders and new or small-time crypto holders who will be mostly at high risk, like a school of fish and other various creatures in the ocean. Despite these, the highly wealthy private investors and corporations, and investment funds that have purchased a large amount of digital assets, are referred to as the “whales”. 

How Do They Affect Crypto Markets?

The crypto whales in the crypto market affect the price swings, liquidity, volatility, and small investors. The involvement of crypto whales is mainly noticeable when there is,

Rise in the Price

• The sudden rise in the cryptocurrency’s price happens when a whale places a huge order. This large purchase of the asset creates a quick shift in the market’s supply and demand. 
• It also triggers the fear of missing out on their profits among the small retail traders, creating anxiety and urgency, which prompts them to jump into trades, leading to a further increase in the price.
• The price reaches its peak due to high demand and limited supply when it is decided to be bought by a large number of retail traders. 

Price Drop

• The dumping of a large portion of their holdings creates a sudden drop in the price due to high supply, leading to the unwillingness to buy the order at a high price.
•  Hoarding and reduced supply create a shortage by holding a huge amount of crypto for long periods.
• A psychological domino effect is created among the small investors by crypto whales when a sell-off is conducted in large volume, which drops the price, allowing the whale to buy back the asset at a lower price.

Significant Impact on the Whole Direction of the Market

•  The whales can create fear, uncertainty, and doubt among small investors.
• Posting on social media about their updates can also manipulate others for their own profit. 
• Manipulation is done by whales through different methods in the crypto market. One among them is the pump and dump strategy, which is misleading investors by raising the prices before selling the asset, and later, the sudden fall in the price gives them a financial loss.

Crypto Whales List

Institutional crypto whales are the organizations, and individual crypto whales are the individuals who hold a large amount of cryptocurrencies and can influence the market 

Here is a list of some crypto whales.

 Institutional Crypto Whales

1. Microstrategy

This is an American company founded by Michael J. Saylor, Sanju Bansal and Thomas Saphr in 1989. A strategy adopted in 2020 by the co-founder, Michael Saylor, to keep the company’s cash as Bitcoin is the initial step that later became the company, known for holding the largest Bitcoin (638,460 BTC). 

2. Grayscale

This organization has become one of the whales because of their high influence they were able to create in the crypto market. It was founded in 2013 and became a company fully owned and controlled by Digital Currency Group in 2015. GBTC ( Grayscale Bitcoin Trust ) allows both individual and institutional investors to invest the Bitcoin. It is now known as the first spot Bitcoin Exchange-Traded Fund (ETF) in the US.

3. Tesla

Tesla is an American MNC owned by Elon Musk. It became one of the crypto whales in 2021 due to its high investment in Bitcoin. The company’s actions have created a great impact on the cryptomarket. Its initial investment was $1.5 billion, which created huge demand and a price capable enough to influencing the digital asset. 

4. BlackRock, Inc

5. TetherLimited

Tether Limited is a private financial technology company that issues the Tether Stablecoin. It was founded in 2014. The market influence, the minting and burning of USDT, which acted as a liquidity provider, and huge holdings of digital assets are the reasons why it is considered a whale.

Individual Crypto Whales

1. Satoshi Nakamoto

It is a name used for an anonymous person or a group of persons. They fall under the category of whales, as they hold one of the largest numbers of unspent and untouched Bitcoin holdings since 2010. 

2. Vitalik Buterin

As a co-founder of Ethereum and holder of over $1 billion, and the one who accepted and promoted the cryptocurrency, he deserves to be considered a ‘crypto whale’.

3. Changpeng Zhao

He is the founder of Binance, the world’s largest cryptocurrency exchange. Rather than just doing crypto trading, his intention to dominate the market innovatively made him a crypto whale.

4. Cameron Winklewoss and Tyler Winklewoss (Winklewoss twins)

They are the founders of the Gemini Cryptocurrency exchange in 2014. They adopted the idea of Bitcoin from the earliest itself and they were able to introduce the cryptocurrency to more people, which gave a strong foundation in its growth.

5. Barry Silbert

He is one of the earliest large-scale investors in Bitcoin and the founder of Digital Currency Exchange. He emphasized buying large amounts of Bitcoin when the price is low and also believed in long-term investment over short-term.

Crypto Whale Tracker Live

It’s important to observe the movements taken by the whales for the investors and entrepreneurs to make the right decisions. For this purpose, several crypto whale trackers are used. Some of them are:

Whale Alert

It is a tool used to track mainly whether any large transactions have been made by any whale, which was founded in 2018. It gives timely notifications so that they get the information at the time and can understand the market trends, take appropriate decisions to avoid higher risks. But as the receiver’s and sender’s addresses are unknown to others, there might be misinterpretation. So, not all transactions can be considered as trade. Sometimes internal exchanges also happen.

Arkham Intelligence

It is an analytics platform that uses artificial intelligence to track data publicly recorded on the blockchain. The analysis process is done with the help of an AI engine called Ultra. It is displayed in human-readable format. Despite these benefits, revealing the real-world entities can be taken as a violation of privacy.

Etherscan

It is a platform or tool that helps to explore the Ethereum blockchain. Vast transactions, access to get all transaction details, and also helps to execute some specific agreements. It is a user-friendly tool for all Ethereum-based activities. However, it limits the use of AI, machine learning, and data collection due to its restricted terms and service. 

All the transactions, including what the cryptowhales are buying, can be tracked with the help of these tools. Along with these types of analytical platforms, some social platforms like X and Telegram are mainly used by Whale Alert to help investors stay updated. Following some traders and analytical traders also helps with the same. But blindly following them can cause financial trouble; sometimes their hidden intentions can mislead other users. 

Bottom Line

Just like whales in the ocean, when they swim, they create big waves; Cyptowhales can shatter the market. It can create both positive and negative impacts. Their large transactions increase the liquidity. It also attracts other users to invest and encourages more participation in the market. But volatility and manipulation are something other traders or investors should be aware of. Since they are highly influential, understanding and learning how to control or exist is important. Being updated with the right information through different methods, strategies, and platforms will help to deal with such a complicated and unpredictable world of digital assets.