A Whale'sđł Effect on Price
Whalesđł can also increase price volatility, especially when they move a large quantity of cryptocurrency in one transaction. For example, the lack of liquidity and large transaction size can create downward pressure on Bitcoin's price if an owner tries to sell their bitcoin for fiat currency because other market participants see the transaction. Other investors go on high alert when whalesđł sell, watching for indicators that they're "dumping" their holdings.
A common sign crypto investors watch for is the exchange inflow mean, or the average amount of a specific cryptocurrency being deposited into exchanges. If the mean amount of coins per transaction rises above 2.0, it is believed to mean that whalesđł are likely to begin dumping if it correlates to a large number using the exchange.
The price is influenced not only by the inflow mean, but also by the publicity given to a particular whale'sđł transaction. Bitcoin prices appear to respond to transactions involving large amounts of cryptocurrency when they're publicly announced on X by Whaleđł Alert or communicated by news outlets.
