Meaning | Whale (crypto) | Futura Tech

Holders of the largest cryptocurrency portfolios are referred to as whales. Their influence is immense, almost unreasonably great, but nevertheless inescapable. In the cryptocurrency world, the term whale (whale, in English) means an individual or a company that has a large holding of cryptocurrency. The term originates from the stock market universe. The similarity comes from the fact that when whales move in the ocean, they generate large waves capable of pulling the smallest fish.

The main whales

In the world of bitcoin, it is considered that having more than 1,000 BTC is enough to identify a whale. This indicates that there will be approximately 2,500 in the world. So, the State of El Salvador, which has 2,300, is in the lot. The identity of most of these whales is unknown because the addresses of the holders of wallets (portfolio) is almost anonymous.

Historically, Satoshi Nakamoto, the official creator of bitcoin – but unknown in real life – will be the biggest whale in existence, as he holds more than 1 million original BTC (bitcoins) that he has never sold. On paper, this would make him a multi-billionaire and one of the richest people in the world.

Among the individuals holding large amounts of BTC are brothers Cameron and Tyler Winklevoss. For the record, the rowing champion twins say they were behind the Facebook project or at least gave Mark Zuckerberg the idea – this story is told in the film The Social Network. A lawsuit began in late 2004 and resulted in an out-of-court settlement in February 2009. The two brothers walked away with more than $20 million and a portfolio of Facebook shares worth $10 million. . However, in 2013, Winklevoss showed savvy by investing part of this loot in bitcoin, buying 78,000 BTC – when this cryptocurrency was worth 141 dollars.

Another whale, venture capitalist Tim Draper acquired 29,656 BTC in 2014 – when its price was at $632. Barry Silbert, for his part, acquired 48,000 BTC at the same time and created an investment fund, the Digital Currency Group. Michael Saylor, CEO of software publishing MicroStrategy has 130,000 BTC. Finally, major cryptocurrency exchanges, including Binance, and Kraken are inherently large cryptocurrency holders.

The whale effect

The impact of whales on the market is undeniable. It is enough for a whale to make major purchases or sales, for it to significantly affect the price of a currency.

For example, if a whale places a huge sell order of his BTC, ETH, SOL or others, this is usually enough to cause the price of this currency to drop. Sometimes the whale acts deliberately: when the price drops enough, it can buy BTC, ETH or something else in bulk.

We are far from the libertarian and idealistic view that the originators of Bitcoin may maintain.

In January 2021, Elon Musk announced that Tesla had purchased $1.5 billion worth of BTC. A spectacular rise in the price of this cryptocurrency followed. And then, in July of the same year, Musk finally sold 75% of his BTC, helping to lower the price. In a similar vein, when Musk announced that he was backing the Doge cryptocurrency, this second currency saw its price rise.

This is why some speculators monitor the activity of large portfolios – even if they are unknown, they are easily seen in the crypto universe – to “mimic” their behavior. Sites like Watcher Guru or WhaleMap or the Twitter account Whale Alert track these cryptocurrency mega-expanders.

A handful of holders with too much power

The fact that 2,500 whales can handle most of BTC’s holdings is not without its problems. So, in November 2020, a Bloomberg study showed that 2% of Bitcoin accounts control 95% of BTC holdings. That a currency can see its course change according to the tweets of Elon Musk, and other big fish, is far from the libertarian and idealistic view that those at the origin of Bitcoin might maintain.

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