Who are Crypto Whales? Understanding the Big Players in Cryptocurrency
What are Crypto Whales?
There are enormous entities, both individuals and companies, in the crypto ocean that swim in the deep with unimaginable power and influence to move markets at will. Such individuals or institutions are referred to as “crypto whales.”
A crypto whale is a person or organization that has possession of considerable amounts of a particular cryptocurrency. Their massive holdings can change the market, thus affecting the fluctuation of prices and changing the overall outlook in the market.
How Crypto Whales Manipulate the Market
Crypto whales can manipulate the market in ways that other smaller investors cannot. Here are some of the tactics they apply:
Market Manipulation
With vast purchasing power and capabilities to buy or sell large volumes, these whales can inflate or deflate the price of the cryptocurrency at their wish. This normally creates fear and greed among minor investors, making them sell due to panic or even buying out of greed.
FOMO and FUD
The psychology that these whales use is sowing FUD (Fear, Uncertainty, and Doubt) or creating which is the fear of missing something. For instance, by dumping a huge amount of crypto tokens for sale, they can provoke a sell-off. Other investors start feeling panic and sell their investments. Conversely, by collecting a big position, they are able to create a sense of FOMO, which makes prices hike up.
Whales as Market Makers
Under some conditions, whales can act as market makers by providing liquidity and stability to the marketplace; however, they also tend to manipulate the market using the role at times to their advantage.
Making Public Opinion
Using their social media or similar platforms, whales can make public opinions. If such public opinion is either positive or negative information, whales will influence the perception of the market as a whole leading to an influence on price.
Many whales do this. For example, Michael Saylor consistently makes public appearances and keeps re-iterating his opinions on the power of Bitcoin.
Psychology of a Crypto Whale
The crypto whale motivations, though multiple and diverse, are centered on making money. And in the world of finance, might is the right. Many whales do this with an understanding that their perceived high-value currencies have a good potential to go higher and gain a good reward through the holding of huge positions.
Belief in the Technology
A lot of whales are ardent believers in the underlying technology of cryptocurrencies. They view them as a financial revolution and understand crypto’s potential in the future of the financial world as well as in our daily lives.
Hedge Against Inflation
Some whales regard cryptocurrencies as being hedged against inflation. They think that old money will lose its value over time, but the purchasing power of cryptocurrencies would be increasing.
Having a large amount of cryptocurrency can make a person feel powerful and influential. Most of them enjoy the thought of having the ability to move markets and shape their fate in the industry.
Five Well-Known Crypto Whales
There are many crypto whales. Below is a list of some well-known whales that have a significant influence as well as holdings in Bitcoin and major cryptocurrencies. Some of them are fictitious entities while others are as real as us.:
- Satoshi Nakamoto: The most mysterious person in the crypto world is Satoshi Nakamoto. He is believed to be the one and only founder of Bitcoin. However, nothing has ever come out about Nakamoto except the fact that he owns around $1 trillion in Bitcoin.
- The Winklevoss Twins: Brothers Tyler and Cameron Winklevoss are a pair of successful investors who earned millions and billions with Bitcoin. They have also founded Gemini, one of the largest cryptocurrency exchanges of all time.
- Michael Saylor: Microstrategy CEO Michael Saylor has been a center of public attention due to his intense buying of Bitcoin via his company. Till date he is believed to have bought 250k Bitcoins.
Not only he was able to create one of the largest Bitcoin companies, but he also demonstrated the company’s ability to purchase Bitcoin with debt in such a way that the total assets still exceeded the total debt in the company. This has made the company fully liquid despite the fact that most of the Bitcoins were purchased on borrowed funds. - Barry Silbert: DCG founder and CEO, Barry Silbert, stands out as one of the most influential personalities in the digital currency world. He has investments in several crypto companies, including Grayscale Investments and CoinDesk. However, Silbert has also made some controversial decisions that had earlier landed him in trouble.
Crypto whales have significant power to influence markets and move them as per their will. Their high holdings force them to act in a certain manner so that their investments remain safe and keep growing regardless of the market situation.
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