✍ For whales in cryptocurrencies, there is a bright side despite the common negative image about them, especially when looking at the matter from broader angles:
1. Providing liquidity
Whales are often a primary source of liquidity in the market. Without them, executing large trades can be difficult without significantly impacting the price.
2. Temporary market stability
When a whale buys large amounts of a currency, it can create temporary confidence in the market and prompt others to buy as well, creating a short-term upward wave.
3. Alerting the market to opportunities
Whale movements may alert smaller traders to currencies with potential, as some track large wallets to spot opportunities ("copy whales").
4. Supporting promising projects
Some whales invest in emerging projects and financially support development teams, which helps in the development of blockchain and web 3 technologies.
5. Indirect market regulation
When liquidity is distributed among several whales rather than a single whale, it may create a kind of competitive balance, reducing the likelihood of outright manipulation.
✍️ However, the dark side remains ever-present:
- Price manipulation.
- Pressure on small investors.
- Creating FOMO or FUD (fear of missing out or fear, uncertainty, and doubt).
But in the end, the existence of whales is a natural part of any large financial market, just as it is in stock or gold markets.
1. Providing liquidity
Whales are often a primary source of liquidity in the market. Without them, executing large trades can be difficult without significantly impacting the price.
2. Temporary market stability
When a whale buys large amounts of a currency, it can create temporary confidence in the market and prompt others to buy as well, creating a short-term upward wave.
3. Alerting the market to opportunities
Whale movements may alert smaller traders to currencies with potential, as some track large wallets to spot opportunities ("copy whales").
4. Supporting promising projects
Some whales invest in emerging projects and financially support development teams, which helps in the development of blockchain and web 3 technologies.
5. Indirect market regulation
When liquidity is distributed among several whales rather than a single whale, it may create a kind of competitive balance, reducing the likelihood of outright manipulation.
✍️ However, the dark side remains ever-present:
- Price manipulation.
- Pressure on small investors.
- Creating FOMO or FUD (fear of missing out or fear, uncertainty, and doubt).
But in the end, the existence of whales is a natural part of any large financial market, just as it is in stock or gold markets.
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content. See T&Cs.
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