Who's Crypto Whale?

 

Crypto Whale has always been an interesting topic on social media, blog forums, websites, etc. Because their existence and activities are able to shake market dynamics, so that the ups and downs of crypto prices will always be associated with the activities of the whales. in this post I will try to explain about whales, who are the crypto whales and where do they trade?

What is a Crypto Whale?
Crypto whales are simply a term for a person or group of people/organizations who hold large amounts of cryptocurrency and have the ability to control the movement of the crypto market. So that volatility and liquidity in crypto is often influenced by the decisions of the whales. It could happen that a whale only has one type of crypto (eg only Bitcoin) or they also have several types of cryptocurrencies such as BNB, Solana, ADA, Ethereum etc.

Who is the Bitcoin Whale There are many crypto whales scattered out there, but in general they are anonymous, so it is difficult for us to know who the crypto whales are, but to make it easier we can group crypto whales into 4 groups, namely:

1. Crypto Exchange
The amount of crypto storage on crypto exchanges will always increase every day, either from profit or additional capital with their aim (crypto exchanges) increasing liquidity and increasing the amount of crypto in their trades. The accumulation of crypto on exchanges that occur over the years will become the center of crypto storage, so it is not surprising that crypto exchanges will become the first crypto whales such as Binance, Coinbase, Kraken, Gemini, Okex, Bitfinex etc.

2. Institution
Many institutions keep their funds in the form of cryptocurrencies either as investments or as hedge funds. It is easier to identify institutions that are crypto whales, because in general they are broadcast on social media or disseminated through websites. Institutions classified as crypto whales are as follows: Grayscale, MicroStrategy Inc, Galaxy Digital Holdings, Tesla, Square etc.

3. Crypto Mining Pool
We would never have guessed that crypto mining pools are included in the group of crypto whales, we don't know for sure how much they mine, how much crypto they sell, and how much crypto they keep as a long-term investment. A year ago China was the largest Bitcoin mining company in the world, more than half of the Bitcoin in circulation was mined by China. Here are some trusted big Bitcoin mining pools such as: F2Pool, Antpool, Binance Pool, ViaBTC, BTC.com etc.

4. Individual
Individuals who are classified as whales are mostly early investors when buying Bitcoin at very cheap prices. and they keep it for years. Many new rich people were born from cryptocurrency such as: Cameron and Tyler Winklevoss (founder of Gemini exchange), Brian Armstrong, Sam Bankman-Fried, Chris Larsen, Michael Saylor etc. In general, individual whales are unknown, but when they sell Bitcoin in large quantities it will shake up the crypto market, causing a stir in the crypto world. The creator of Bitcoin Satoshi Nakamoto is also very worthy of being classified as whales, because it is estimated that Satoshi has mined more than 1 million Bitcoins. Currently more Bitcoins are stagnant in wallets (not moving) to any address.

The Effect of Whales on Crypto Prices
The crypto whales not only store their crypto in their wallets and leave it for years, but there are also many whales who are active in crypto trading, so that it will always move the market price. Of course, because the whales hold large capital so they are able to control prices, whatever their activities, whether buying or selling, will affect the crypto market. Wise whales will certainly not immediately buy crypto in large quantities but they will use a macro buying strategy, where he buys crypto gradually where the price drops 1-3%, so that the effect of buying whales will not directly have a negative impact on the market.


Where the Whales Trade
Whales often use different methods to trade crypto, so each crypto transaction method used by whales will have a very different impact on market conditions. Here are the transaction methods that whales often use:

1. Over the counter (OTC)
Over th counter is trading outside the crypto exchange, the dealer (seller) will act as a market maker who determines the selling price, until the agreed price occurs. These market participants transact using telephone, email or electronic trading systems with large-scale transactions. This OTC trading method has almost no effect on the market price as it does not involve an exchange.

2. Wallet to Wallet
Over The Counter trades between whales often occur only when crypto is transferred from one wallet to another, so it is rarely known by the public and is private in nature, with almost no effect on market prices.

3. Wallet to Exchange
Currently, although there are many exchanges with high liquidity and able to pay large amounts, some exchanges have limited the number of transactions, For example, Coinbase has a purchase limit of up to $25,000 dollars per day. Kraken only allows us to withdraw/withdraw up to $2,500 per day and $20,000 per month. Circle has a withdrawal limit of up to $3,000 per week.

4. Exchange to Wallet
An exchange to a wallet is the opposite of a wallet transaction to an exchange, where the whales will withdraw large amounts of crypto to their wallet, if the exchange does not set a withdrawal limit then the supply will be greatly reduced if the assumption of a fixed number of requests then the price will rise.

5. Exchange to Exchange
It is possible that whales will also transact from one exchange to another, to get the price difference from their arbitrage trade, although the price difference is relatively small, but because whales trade in large quantities, they will get big profits too.