Crypto Whale is an entity that holds enough cryptocurrencies to significantly affect market prices by trading a large number of currencies and tokens. Although there is no direct or clear threshold, most bitcoin whales have at least 1000 bitcoins. So, is it dangerous to encrypt whales? This is the content to be discussed in this article.

Crypto whales can place considerable sales orders by dumping large orders at low prices and controlling supply and demand. This will lead to a fall in prices and a chain reaction of hysteria, making the market more and more unstable.

A chaotic crypto market will only stabilize when a whale cancels their large sales or people's comprehensive purchasing power catches up. The current price is what whales want, enabling them to accumulate more cryptocurrencies with the value they want. This method is called "sales wall". The exact same process can occur in direct purchase. Cryptocurrency runs on decentralized blockchain technology, allowing users to be anonymous. This makes it impossible to link specific accounts to specific individuals or entities.

Cryptocurrencies with smaller market values are more vulnerable to attacks by whales. Market value is a statistic used to evaluate the proportional value of cryptocurrencies in the crypto market. You can simply find the market value of a password by multiplying the current market price of a single stock by the circulating supply. For example, if a specific cryptocurrency, such as ETH, is priced at $10 per unit and 20000000 units are in circulation, the market value of ETH will be $200 million.

It is important to remember that market capitalization and cash are different, although they can provide some information about the relative performance and success of a particular encryption. Therefore, it cannot reflect the number of passwords in the market. Most people mistakenly believe that the price of cryptocurrency will directly affect the market value estimation. But in fact, even small changes in value will have a significant impact on its market value.

Considering the previous example, it is easy to see that millions of dollars can theoretically push the price of ETH up from $10 to $18, increasing the market value from $200 million to $360 million. This does not mean that a new ETH worth 160 million dollars has entered the market. On the contrary, liquidity and transaction volume, two independent but interrelated concepts, determine how much cash is needed to generate such price rise.

Although liquidity is essentially the extent to which crypto users can buy or sell cryptocurrencies without significantly affecting prices, transaction volume refers to the number of cryptocurrencies exchanged within a specific time frame. As there are many transactions in the trading volume, and a large number of potential orders span different price ranges, whales will not easily affect the liquidity market with high trading volume.

As a result, it becomes more unpredictable, making it increasingly challenging for whales to significantly affect prices without a lot of encryption. In contrast, cryptocurrencies with smaller market capitalization and smaller trading volumes can be easily manipulated for smaller amounts of encryption without significantly affecting the price and market capitalization of specific encryption.

summary

The above is a discussion on whether whales holding a large number of cryptocurrencies in the field of encryption are dangerous. All in all, crypto whales are individuals or organizations with a large number of specific cryptocurrencies. They have enough cryptocurrencies to affect the market price. If they want to manipulate ordinary users for personal gain, it may be very dangerous. Therefore, it is important to track cryptowhales and their activities to avoid potential losses.