Whales cause sudden price fluctuations in the cryptocurrency and traditional markets regularly. Given their ability to manipulate market prices, it is vital for general Bitcoin (BTC) investors to understand what is considered a whale and the whale's overall impact on trading .
Wallet addresses containing large amounts of BTC are identified as Bitcoin whales. Dumping or transferring large amounts of BTC from one wallet to another negatively impacts the price, leading to losses for smaller houses. Therefore, by following Bitcoin whales, small traders can make profitable trades amid market volatility.
Despite the global and decentralized nature of Bitcoin, whale tracking and monitoring is simply a matter of accessing readily available transaction data from cryptocurrency exchanges and services. There are four main ways to track whale activities, including tracking known whale addresses, order books, sudden changes in market capitalization, and trading on cryptocurrency exchanges.
Tracking known whales provides a head start for small investors as the likelihood of coming across a big trade increases significantly. Furthermore, tracking market changes through order books and trading on cryptocurrency exchanges reveals upcoming whale trades, which can be leveraged to profit during volatile times. dynamic.
The cryptocurrency community also uses free services to notify investors of successful whale transactions, which often include information about the sender's and recipient's wallets as well as the amount. One of the most popular services for automatically tracking whale transactions is @whale_alert on Twitter, which issues alerts related to large transactions as shown above.
In a recent market update, on-chain data showed that the largest Bitcoin holders have been reluctant to act at current prices. BlockTrends analyst Caue Oliveira supported the above finding by highlighting an ongoing “hibernation” among whale wallets. He added:
“Institutional movements, or commonly known as “whale activity” can be tracked based on the volume of transactions moved over a short period of time, both in BTC and USD.”
Furthermore, many altcoins continue to mimic Bitcoin's bearish trend as whales wait for a greener turn in the crypto market.
