Crypto Whale or Crypto Whale is a crypto community term that refers to individuals or entities that own large amounts of crypto. Whales are crypto enough that they have the potential to enjoy the currency scene.
Achieving Whale status in the crypto space is subjective. In most cases, the community agrees that many of the coins available make the account Pope. Pope generally sees more than 10% of the total amount of specific cryptocurrencies.
Big crypto holders are called (Whales) because Whales are enormous compared to the smaller fish in the crypto ocean. According to BitInfoCharts, the four bitcoin wallets held 3.49% of all bitcoins in circulation in May 2022, and the top 100 wallets had about 15.36% of all bitcoins.
Dogecoin, the meme coin that became popular, is even more critical. As of May 2022, 15 addresses, almost 52% of Dogecoin, and more than 29.5 billion coins.
The crypto community and investors closely monitor large accounts. If any of the top 100 wallets make a transaction, they are announced publicly via the Whale Alert website and Twitter account as they occur.
Whale Effect on Liquidity
Because they are high-profile wallets, whales can be a problem for cryptocurrencies due to the wealth of concentration, especially if they are not moving into the account. When coins are held in an account rather than being used, it degrades specific cryptocurrencies because there are fewer coins available.
Whale Effect on Price
Whales also increase volatile prices, especially when they move large amounts of crypto in a single transaction. For example, suppose owners try to sell their bitcoins for fiat currency. In that case, the lack of liquidity and the large transaction size creates downward pressure on the Bitcoin price as other market participants see the transaction. When whales sell, other investors become very wary, paying attention to indicators that the whales are “throwing” their holdings.
A common sign that crypto investors pay attention to is the exchange’s average inflow or the amount of a particular cryptocurrency deposited onto the exchange. If the average number of coins per transaction rises above 2.0, whales will likely start dumping if it correlates with many Whales using the exchange.