Whales are often responsible for sudden price fluctuations in cryptocurrencies and traditional markets. Given its ability to manipulate market prices, it is of paramount importance to Bitcoin in general (BTCInvestors understand the nuances of making whales and their overall impact on trading.
Wallet addresses with large amounts of BTC are identified as Bitcoin whales. Dumping or transferring large amounts of BTC from one wallet to another can negatively impact prices and cost small traders a loss. As a result, real-time tracking of Bitcoin whales allows small traders to make profitable trades as the market fluctuates.
Despite the global and decentralized nature of Bitcoin, whale tracking and monitoring is summarized in crypto exchange and access to readily available transaction data from services. There are four main ways to track whale activity. This includes known whale addresses, purchase orders, sudden changes in market capitalization, and monitoring of transactions on cryptocurrency exchanges.
Monitoring known whales provides a good start for small investors, as they are much more likely to encounter whale trading. In addition, tracking market changes through purchase orders and trading on crypto exchanges shows incoming whale trading that can be leveraged to profit during volatility.
— Whale Alert (@whale_alert) July 16, 2022
The crypto community also uses a free service to notify investors of successful whale trading. This often contains information about sender and recipient wallets and amounts. One of the most popular services for automatically tracking whale transactions is @whale_alert on Twitter. It raises alerts related to large transactions as described above.
In recent market updates, Cointelegraph revealed that data on the chain suggests that the largest Bitcoin Hodler is hesitant to act at current prices. BlockTrends analyst Caue Oliveira supported the above findings by emphasizing the ongoing “hibernation” among whale purses. He added:
“Institutional investor movements, or what is commonly referred to as” whale activity, “can be tracked in both BTC and USD based on the volume of transactions moved in a short period of time. “
In addition, many altcoins continue to mimic the bearish trend of Bitcoin as whales await more environmentally friendly sentiment throughout the crypto market.