Whale (Crypto Trading)

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What is a Whale?

“Whales” are the big fish in the expansive ocean of cryptocurrency trading, but these aren’t aquatic creatures; they’re individuals or entities who hold vast amounts of cryptocurrency.

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Their substantial holdings, accumulated through early investments, mining, or other avenues, empower them to sway the market in noticeable ways.

For instance, by buying or selling large quantities of cryptocurrency, they can induce significant price fluctuations.

Consequently, their activities often correlate with high market volatility, leading to the popular “whale watching” practice among traders and investors seeking insights into their investment strategies.

Classifying Crypto Holders by How Much They Hold

In the cryptocurrency ecosystem, holders are often classified by the amount they possess.

These classifications help understand the behaviors and potential impacts of various stakeholders in the market.

Here are some common classifications for bitcoin (BTC) holders:

Shrimps (less than 1 BTC): These are individuals who are starting their journey in the crypto world. Shrimps are sensitive to volatility, quickly reacting to fluctuations in price by selling or buying the asset.

Crabs (1-10 BTC): These are the small but well-informed investors, typically those who’ve amassed assets and held onto them for longer than three years.

Octopuses (10-50 BTC): Experienced traders and financial investors fall under this category. They often have a diversified portfolio of multiple financial assets. Besides their holdings on exchanges, they also store their assets in some of the most prominent crypto wallets, indicating a more seasoned approach to security.

The Fish (50-100 BTC) and Dolphins (100-500 BTC): This group is represented by wealthy individuals and companies who’ve allocated a significant portion of their capital for cryptocurrency investments. Their purchasing strategy often involves dividing their buys into several installments to avoid causing major market fluctuations.

Sharks (500-1000 BTC): Typically, sharks are early Bitcoin adopters who managed to get their hands on coins when prices were significantly lower 8-10 years ago. Their belief in the long-term value of bitcoin makes them “hodlers“.

Whales (1000-5000 BTC): These are the big players in the crypto world, comprising institutional investors and crypto millionaires. To evade detection by “whale watching” tools, they often diversify their holdings by splitting their assets into multiple wallets.

Exchanges: Platforms where cryptocurrencies are bought, sold, or traded. They play a pivotal role in determining the liquidity and price stability of many cryptocurrencies.

Miners: The entities responsible for the creation of new coins in proof-of-work systems like bitcoin. Miners only have about 9.5% of the circulating supply of BTC. After mining, they usually distribute their BTC fairly quickly to cover their operational costs.

It’s worth noting that the exact classifications and definitions can vary depending on the context and the source. However, understanding these categories can provide insights into the diverse motivations and behaviors within the cryptocurrency market.

List of Biggest Crypto Whales

Below is a list of the top ten biggest speculated or ‘known’ crypto whales that have a huge impact not just in the cryptocurrency market but in the cryptocurrency mythology too.

  1. Satoshi Nakamoto: A pseudonym for the unknown creator(s) of bitcoin. They are believed to possess around 1 million BTC, roughly equivalent to 19.2 billion US dollars.
  2. Brian Armstrong: The CEO of Coinbase. His estimated crypto fortune is around $6.5 billion.
  3. Michael Saylor: An entrepreneur holding over 17,732 bitcoins, surpassing $1.14 billion. His company, MicroStrategy, also has a considerable bitcoin stash.
  4. Chris Larsen: Co-founder of Ripple, with holdings of 5.19 billion XRP, approximated at $37.3 billion.
  5. Changpeng Zhao: The CEO of Binance. While his exact holdings are confidential, his reported net worth exceeds $96 billion.
  6. Vitalik Buterin: Co-creator of Ethereum. His exact ETH holdings remain a mystery, though he once reportedly held 355,000 Ethereum.
  7. Tim Draper: This entrepreneur has significant bitcoin holdings, boosted by his acquisition of 30,000 bitcoins from Silk Road.
  8. The Winklevoss Twins: After a settlement with Facebook, they invested in bitcoin, acquiring around 1% of all existing BTC. Today, they reportedly have about 70,000 bitcoins.
  9. Barry Silbert: Founder of Digital Currency Group, which encompasses Grayscale—a firm managing over $28 billion in digital assets.
  10. Jed McCaleb: A co-founder of Ripple with around 3.4 billion XRP in his wallet, equating to roughly $1.6 billion.

While I’ve used bitcoin and XRP as examples above, each cryptocurrency will have its own share and definitions of whales, sharks, crabs, and shrimp – with different projects having different thresholds of what they consider the largest whale and the smallest shrimp.

The Bottom Line

Crypto whales undeniably wield significant power in the market, and their actions offer valuable insights into market sentiments.

While it’s tempting to hitch your wagon to a whale’s movements, it’s imperative to remember that whales operate with their interests in mind; they often have access to exclusive information and might even manipulate the market for their gain.

Therefore, while observing whales can provide insights, following them blindly without comprehensive research can be perilous.

Every investor, regardless of their holdings, should prioritize individual research and analysis to navigate the unpredictable waters of cryptocurrency trading.

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Sam Cooling
Crypto & Blockchain Writer
Sam Cooling
Crypto & Blockchain Writer

Sam Cooling is a crypto, financial, and business journalist based in London. Along with Techopedia, his work has been published in Yahoo Finance, Coin Rivet, and other leading publications in the financial space. His interest in cryptocurrency is driven by a passion for leveraging decentralized blockchain technologies to empower marginalized communities worldwide. This includes enhancing financial transparency, providing banking services to the unbanked, and improving agricultural supply chains. Sam has a Master’s Degree in Development Management from the London School of Economics and has worked as a Junior Research Fellow for the UK Defence Academy.