Crypto Whale

Crypto whale refers to a person, group, or entity that holds a maximum number of crypto coins to influence their prices in the market. The prime objective of these whales is to accumulate high amounts to pump and dump (rise and fall) the volatility of these tokens.

The term "whale" is a metaphor for the most significant participant in the crypto market, similar to ocean whales. In contrast, the crypto minnows (or fishes) hold only a few coins. As a result, crypto whale groups can influence token price movements by massive selling and buying. Plus, they impact the liquidity and prices of tokens.

Crypto whale, in the crypto market, is an individual or group that owns many particular currencies. It can also be an organization or a private entity. Likewise, others with modest amounts are fish or crypto minnows in this ocean. However, a user's status is subjective to the currency circulated within the tokenomics. For example, Bitcoin pioneer Satoshi Nakamoto is the most significant person on the crypto whale list, holding the most BTC. He holds around 750,000 to 1,100,000 BTC.  

Every blockchain has specific criteria for a crypto whale group. For example, while most regard a 10% stake as a whale, it might differ for a few coins. Yet, they have supreme power to influence the price of cryptos. As a result, the volatility and price stability of coins frequently fluctuate. For instance, a firm or investor may have substantial ownership of shares in a company. However, if they tend to sell their stake, the stock price will turn bearish and vice versa. The same applies to cryptocurrencies, too. They can also be referred to as market movers. Any strategy associated with them can drive the market in a particular direction. 

Every user with many funds in terms of crypto tokens is the whale of the ocean. Besides, the market also includes sharks, dolphins, and fish-categorized traders. However, specific characteristics of whales impact the market. It includes manipulating crypto prices in the market with excessive wealth owned by them. Likewise, they can drive market sentiments and create a bullish trend among other investors. As a result, the latter can use it as an indicator for their investment strategies. Plus, investors can use a crypto whale wallet tracker to watch their market movements. 

There are various methods and resources available to track the crypto whale wallets. Three main types of transactions can easily track these orders. Let us look at them:

• Exchange to Wallet - As the name suggests, the transfer occurs from exchange to wallet here. In other words, crypto whales try to transfer a large amount from exchange to their cold wallets. They usually try to pick crypto tokens from the exchange via purchase. Consequently, a whale exists if there is a large volume of transactions. 
• Wallet to Exchange - A similar mechanism occurs in this case also. Instead of exchange to wallet, the transfer occurs from a whale's wallet to exchange. Thus, if a crypto trader sells large-volume coins, the coins get loaded back into the exchange. Later, a reflex action causes the token's price to fall. So, if other investors witness a sudden downfall, a crypto whale signals a recent transaction. 
• Wallet to Wallet - The third type of transaction tracker allows the crypto whale to transmit crypto assets from one wallet to another. They usually perform over-the-counter trades. As a result, these trades take time to trace in real-time. However, minute triggers and fluctuations are the final result of it. 
• Other Resources - There are various crypto whale signals like Blockchain Explorers, Whale Alert, DeBank, and On-Chain Analysis. They enable crypto users and other investors to track whales with the exact number of tokens transacted. 

Let us look at the examples of crypto whale groups to comprehend the concept better.

Example #1

Suppose Alfred is a businessman who earns a million as his annual income. As his interest lies in cryptos, he keeps buying them frequently. Slowly, his portfolio ranked among the top 10 individuals owning more than 8% of Bitcoins. In total, Alfred owns 20,000 coins from the rest of the public. So, when he withdrew coins to buy more tokens, the market saw a considerable fluctuation. The price of Bitcoin rose by 15%. Witnessing this rise, the rest of the market started buying the coin. However, only some of them were aware of the crypto whale's presence. 

If Alfred tries to sell his stake in the market, the chart will again react vigorously. As a result, the prices of that particular cryptocurrency will witness a downtrend.

Example #2

According to the news dated August 2023, a mysterious crypto whale has burned $4.6 million in Ethereum coins. The crypto community was puzzled after 2500 ETH was transferred to an unknown address. In short, these coins were burnt. Besides, rare NFTs (non-fungible tokens) like Bored Ape Yacht Club, a Mutant Ape Yacht Club, and a Bored Ape Kennel Club were also burned. However, Arkham Intelligence has identified the anonymous person via the address "nd4.eth."

Crypto whales might seem disrupted, but they play a crucial role in maintaining a coin's price volatility and stability. Whales are vital in handling the cryptocurrency market's steering wheel. They influence the significant demand and supply forces. Thus, they majorly cause any token price fluctuations. If it exceeds, it can manipulate the other investors within the market. They impact the price movements of a crypto coin, causing the liquidity to distort. However, specific good strategies by crypto whales can yield better returns for others.