Are crypto ‘whales’ a modern mythology?

It’s pretty amazing to think that a single individual or group could affect the crypto market alone.

“The whales are dumping”.

I have heard many crypto enthusiasts trot out this well-worn line to describe market changes in a blanket manner. What I would question is, where is the evidence for these so-called whales? I am not disputing that there may be high volume traders making large trades, I just genuinely have barely come across much in the way of solid evidence.

For those who are not aware of what a crypto whale is, it’s a slang term for a very large volume trader or small group of collaborative traders. I will point out before I elaborate, in some situations (such as the low cap, newer cryptocurrencies) the market is ripe for potential ‘whale’ activity, however, I will discuss the whale in terms of the higher volume, established cryptocurrencies.

We all know the inherent risk involved in crypto trading and whales are not immune to this certainty. What I argue is whether whales would risk dumping large volumes of crypto in an effort to buy back in at a cheaper price. The first issue is the potential for the market price to stay at the lowered level or
drop further due to loss of confidence. The second issue is tying up large amounts of capital in a high-risk trade if the market doesn’t rebound effectively.

I, like many others, are fascinated by the anonymity and storytelling behind the idea of the whale. I try to picture what these large crypto holders are plotting and what their strategy is. We all would like significant digital assets to experiment with; this would allow us many different trading strategies or to develop ideas. To many, the whale is the one that has this freedom and opportunity.

I think it is much healthier to abandon the idea of the whale
mythology and focus on the fundamentals of why the trade was not a success.

In some cases, I think that people like to believe there is an outside force manipulating price behind the scenes. This can somewhat justify a market that has turned against them or can be used as justification for a poorly executed trade. I think it is much healthier to abandon the idea of the whale
mythology and focus on the fundamentals of why the trade was not a success. If traders can achieve this I think the long term benefit would be much greater than writing off the experience as out of their hands.

In either case, I think human nature will always let the the whale mythology live on.