Did you know that the largest Bitcoin wallet holds over 168,791 Bitcoins? To put it in perspective, that’s worth over $10,645,817,161 as of April 14, 2021. Another dormant Bitcoin address has over 80,000 BTC, worth over $750 million.
‘Crypto whales’ are some of the most critical players in the crypto market. A crypto whale is an investor with significant capital. They can move substantially more numbers than individual traders, for these entities are usually institutional investors.
It is a commonly held belief that crypto whales control the price of Bitcoin and other cryptocurrencies. That might be true to an extent, but the truth is somewhat more complex.
However, it is always worth keeping an eye on these players because they can provide valuable insight into the future of crypto. For example, a recent crypto whale that focused on Ripple may have altered its future considerably.
What Happened?
A few weeks ago, Born2Invest reported Ripple’s possible comeback as it moved toward the $1 mark. Today, Ripple sits over the $1.7 mark, and it’s a significant event since Ripple’s latest controversy.
Nevertheless, we must focus on the whale behind the article. Decacorn, a fintech company, moved 746 million in XRP via Ripple’s ledger. It’s an understatement to say that the transaction caught investors’ eyes.
How Big Was the Movement?
By the time of the report, the movement was equivalent to over $407 million. Today, after XRP’s value grew over three times, it’s nearly a $1.3 million transaction. The transaction was between two of Decacorn’s crypto wallets.
Since the lawsuit, the SEC has complained that Chris Larsen, Ripple’s co-founder, keeps trading XRP.
Naturally, we can’t say that this transaction was responsible for Ripple’s growth. However, seeing crypto whales still interested in cryptocurrency strengthens confidence in XRP.
Ripple: Moving Forward
About a month after the SEC’s lawsuit, Ripple shows no signs of stopping. Initial fears about XRP’s ability to overcome this setback have subsided. Since then, the company has signed over a dozen contracts with different financial institutions. At the time of writing, Ripple touched the $1.8 mark and shows no signs of stopping.
Ripple’s main advantage is that it doesn’t try to be another cryptocurrency. It’s a prominent player in making cryptocurrencies accepted by traditional institutions.
Why Should You Care About Crypto Whales?
Most traders fall for the idea that they can’t learn from crypto whales. After all, how could they learn from someone with many more possibilities and opportunities? That’s a significant mistake.
Savvy investors understand why it’s best to keep an eye on them. Firstly, they shed light on promising investment opportunities. Additionally, their holdings and decisions can play crucial roles in deciding any cryptocurrency’s supply and demand dynamics.
Learning From Experts
Crypto whales accumulated their capital via effective investment decisions. They’re excellent references for any trader interested in becoming a better investor. Since they’re more likely to spot profitable investments, their movements can be significant signals for traders.
Individual traders need to aim to jump into trends while they’re “fresh” since that means heftier profits. Crypto whales’ cash flows and movements offer excellent insight, which you can use to adapt your strategies for better results.
Considerable Influence
Additionally, crypto whales have a noticeable influence on the market. Most traders believe they control prices because their capital allows them to inflate and deflate investment assets as they wish. That doesn’t cover everything they do.
Many traders keep their eyes on crypto whales because they perceive them as price shifters. This following is usually more potent than the whales’ capital; following their example grows any cryptocurrency’s demand and that’s where the real price shifts come from.
Do Crypto Whales Dictate Prices?
Nevertheless, it would be inaccurate to say that crypto whales dictate crypto prices. Crypto trading requires multiple individuals, and single entities can’t shift prices. Crypto whales could—in theory—do so, yet it’s an unnecessary risk.
That’s not to say that crypto whales don’t influence the crypto market. They don’t control prices at will.
On the Flipside
- Even gigantic transactions can do little to influence a cryptocurrency’s price in the long term. Ripple’s main advantage is its legitimacy and influence.
- If the transaction was between two of the whale’s wallets, the demand boost could be artificial since it doesn’t come from natural market desire.
- If that’s the case, Ripple’s price could plummet as the “bubble” burst. On the other hand, the market probably adapted to the new value already, thus solidifying confidence.