The crypto market has grown to be a very vast space, consisting of diverse principles that govern different processes, and more importantly, a plethora of participants interacting within various blockchain ecosystems. Atop these investors with stakes in the general cryptocurrency market are entities that are large, influential market movers holding many digital assets. This class of entities are referred to as “crypto whales.”
What is a Crypto Whale?
A crypto whale is an individual, exchange, institution, or government that owns massive amounts of cryptocurrency or has the means to make massive acquisitions. The term “whale” varies depending on the cryptocurrency and is decided by total supply, wallet holders, and the value of a single unit of the asset. It is the percentage of an asset held by a person or entity in relation to the total number of available units and the number of addresses where the asset is held.
For example, to be labelled a Bitcoin whale, an investor must own at least 1,000 Bitcoins, which is approximately $16.7 million at the time of writing. Due to the total supply, owning 500 Bitcoin, or approximately $8.4 million, does not qualify an investor as a whale, but holding its equivalence in a smaller coin like GALA token would qualify as a whale amount, with approximately 450 million GALA, which constitutes more than 6% of its total circulating supply. Essentially, crypto whales of top coins such as Bitcoin and Ethereum have far greater currency worth and market influence than whales of smaller coins.
CEOs, owners, and founders of numerous crypto ventures are among the largest crypto whales. Satoshi Nakamoto (creator of Bitcoin, who reportedly mined over a million Bitcoins), Pantera Capital, Changpeng Zhao, CEO of Binance, Michael Saylor (CEO of MicroStrategy), Brian Armstrong (founder of Coinbase), the Winklevoss Twins, Justin Sun (owner of Tron blockchain), and a few others are among those who have been doxxed.
Crypto Whales’ Impact on The Market
A crypto whale would typically have an address or addresses containing significant amounts of a cryptocurrency’s total supply, sufficient to influence or impact the market through its activity. When a whale purchases a large amount of a particular cryptocurrency, its price is bound to rise. Their decision to sell large amounts of the asset (dumping) at any time, on the other hand, can generate scarcity and cause a reduction in its value, as well as a lack of trust among smaller investors, who then sell in panic, leading to a persistent drop in the asset’s market price.
In 2019, the price of Bitcoin rose from roughly $4,200 in April to around $11,500 by the end of June, owing to the impact of the whale market. The increase appeared to be a natural breakout, but it was later determined that the spike was caused by a purchase of 20,000 Bitcoins across three separate exchanges. Another example was the increase of the value of GALA tokens by over 20% back in March when the asset piqued the interest of ETH whales who bought them up in large amounts.
Crypto Whale Watching
Whale watching is the practice of keeping track of the wallet activities of addresses that hold large sums of cryptocurrency. Smaller investors or market analysts typically track elements such as their addresses, blocks, asset holdings, the proportion of available supply, first entry, and total asset purchasing and selling to acquire insight into the market’s potential direction.
When it comes to whales, fewer entities hold larger amounts of assets and have the ability to transfer massive sums of money across wallets and networks, causing market trends and volatility. As a result, whale tracking has various advantages, including:
- Insider knowledge of a project’s future, since crypto whales may be founders or early investors in a crypto project.
- Smaller investors can build confidence in holding an asset, replicate investing options, and profit alongside the whales.
- Mitigating losses and averting whale dumping if whales decide to sell all of their assets, causing the market to decline.
Several tools and apps are available to track crypto whales. The top whale-tracking apps and sites are Whale Alert, BitInfoCharts, Clank App, and Whalemap.
- Whale Alert: Whale Alert is the most advanced tracking platform that collects large sums of data to provide daily live trading and analysis of millions of blockchain transactions.
Whale Alert monitors the major cryptocurrency wallets and posts real-time transactions on their website, Twitter, and Telegram. The platform’s API simplifies blockchain data and makes it easily accessible, as well as transparent.
- Bitinfochart: Bitinfochart provides real-time statistical crypto data to compare over 30 digital assets. The platform published the total coins in circulation, price, market cap, 24-hour transactions, top 100 richest, active addresses in the last 24 hours, blockchain size, Reddit subs, tweets per day, and other relevant information.
Whale watchers can benefit from the “Top 100 Richest” section, which presents data in a tabular, user-friendly manner, showing how total coins are distributed in number and percentages, how top addresses rank in wallet size, blocks, balances, percentage of total coin by each whale, initial entry, last entry, total in, total out, and a wallet life cycle graph.
- ClankApp: ClankApp features an explorer that allows you to track crypto whales and their activity in real-time across 20 blockchains including Bitcoin, Ethereum, Tron, and Litecoin. Every day, they collect large quantities of data from various crypto players and offer updates on whale activity on their website, revealing the value, sender, receiver, and date of each transaction.
The app also incorporated ideas such as “whale of the day” and “whales of the week” based on recent activities to keep people interested.
- Whalemap: Whalemap is a blockchain analysis application that tracks data from blockchains such as Ethereum, Solana, and Polygon. One of their blockchain data tracking services is whale watching, which gives information on huge wallet inflows, whale outflows, and massive transactions.
As you monitor crypto whales in order to better position yourself, reduce losses, and diversify your portfolio, keep in mind that whales have more liquidity to leverage and risk, and the market is still quite volatile. DYOR and make your own informed decisions based on the whale tracking data.