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What is a Bitcoin Whale in the cryptocurrency business? 🐋
A whale is a term used in the cryptocurrency ecosystem to describe an individual or entity that holds an extremely large amount of BTC, for example, in their wallets or addresses.
They are called "whales" because their holding power is significantly greater than that of retail investors ("fish" or "shrimp").
The exact amount to be considered a whale can vary over time, but generally, it refers to holdings greater than 1,000 BTC. The largest, sometimes called "mega whales," hold more than 10,000 BTC.
📈 Influence on the Market:
The actions of whales are closely monitored because they can have a considerable influence on the liquidity and volatility of Bitcoin's price.
Sale:
If a whale sells a large portion of its reserves in the open market, the sudden increase in supply can create downward pressure on the price.
Buy:
A massive purchase can have the opposite effect, driving the price upward.
Due to their size, whales can sometimes be perceived as a risk of centralization of wealth or even market manipulation through tactics like pump and dump or spoofing in the order books.
However, many large transactions are conducted over the counter (OTC) to mitigate this impact. Understanding their movements is key to analyzing potential market trends.
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