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What are Bitcoin whales and do they really control the market?



They are widely talked about in the cryptocurrency space: Bitcoin whales. But what exactly are Bitcoin whales and do they really control the market?

Way before the literary clash between Moby Dick and Captain Ahab took place, whales were already a sort of myth. The enormous and mysterious sea mammals are now an everyplace cryptocurrency metaphor, fueling FUD and FOMO alike whenever spotters scream: there she blows!

What is a Bitcoin whale?

The term “Bitcoin whale” is commonly used to refer to investors who treasure large amounts of BTC. A taxonomy offered by chainalysis classifies them in 4 basic types, by descending wealth: traders, miners and early adopters, lost whales, and criminals (only 3 wallets out of 32 were identified as such).

However, much of a conspiracy hype has been built around Bitcoin whales, sometimes fueled by traditional news outlets. The possibility of publicly witnessing transactions on most blockchains also tends to trigger speculations on social media, quite often after one of the many whale-watching Twitter accounts reports a large transaction. Reddit has also taken upon serious detective work on several occasions to unearth the motives behind such moves.

Watch: Remember the whale dumping 35K ETH, flash crashing it to $0,10? This is the video

Do Bitcoin whales really control the market?

There has been much of a controversy on this point. When taking a look at the distribution of Bitcoin funds in wallets, it would seem as if a large percentage of the total number of bitcoins is kept by few hands.

Bloomberg once tried to infer a situation of large market concentrations from the distribution of bitcoins in wallets. On a notably tendentious article titled “The Bitcoin Whales: 1,000 People Who Own 40 Percent of the Market”, the author engages in the following FUD-boosting argumentation line “While they (ordinary investors) can track addresses with large holdings online and start heated discussions of market moves on Reddit forums, they’re ultimately in the dark on the whales’ plans and motives”.

The writer keeps on arguing in the same direction: “the top 100 bitcoin addresses control 17.3% of all the issued currency […] with ether, a rival to Bitcoin, the top 100 addresses control 40% of the supply”.

The premise of this article is fake, as it constitutes what in science is normally called an ecological fallacy: making assumptions on individuals based on inferences about the group they belong to. Andreas Antonopoulos, Bitcoin advocate and expert author, explains it with detail on this video:

Put simply, there is no way Bloomberg or anybody else can determine market concentration just by looking at Bitcoin wallets, as this data does not correspond or even approximates remotely to the real number of Bitcoin users.

A single wallet can store funds belonging to millions of investors, and a single investor can own a million wallets.

Then, how much of an influence do Bitcoin whales have over the market?

The most up-to-date and serious research about the true nature and impact of Bitcoin whales was published last October by crypto research firm chainalysis.

Read more: Research: Whales are not destabilizing, but stabilizing the Bitcoin market

The study analyzed the 32 largest Bitcoin wallets not belonging to exchanges. First, they conclude they hold about 1 million BTC, or about 6% of the current circulating supply of 17.5 million BTC. This is perhaps the soundest estimation in so far of how much BTC is on the hands of Bitcoin whales.

Although 6% might seem as a lot, the percentage is not as high when put into the fairly similar context of stock ownership. About 6% of Apple is owned by investment firm Blackrock alone. And Bill Gates owned more than 1% of all Microsoft shares until selling most of them over the past years.

Looking at firms on an earlier stage of their public trading history, and thus more relatable to the 10-year-old Bitcoin, their shareholder concentration is even higher: Spotify CEO Daniel Ek still owns 25% of the company’ stock.

When it came to probing the real power of whales to manipulate the market by acting together, there were some surprising conclusions. As shown in the above chart, Bitcoin whales actually tend to stabilize markets, contrary to popular opinion.

During large sell-off periods, they were net receivers of Bitcoin from exchanges. A limitation of this study that needs to be taken into account is that it did not include on-exchange transactions.

Read more: 9 Bitcoin price predictions for 2019 by crypto experts

Who owns the largest Bitcoin wallets?

Per the faulty logic that considers wallets to be the same as users, if we took a look at largest ones we would be certain that Bitcoin is a highly concentrated asset. However, reality is quite the opposite.

At writing time, there were only 5 addresses holding more than 100,000 BTC. Coincidently, the 5 of them belong to exchanges (Bitfinex, Binance, Huobi, Bittrex and Bitstamp), thus fostering market pluralism as millions of users are actually behind the funds. These are also known as cold wallets, where tokens are stored for long periods of time with the premise of safety in mind, as opposed to hot wallets, used for day to day operations and often more exposed to hacks.

Read more: At what price will Bitcoin make Satoshi Nakamoto the world’s richest?

As the graph extracted from bitinfocharts shows, currently more than 70% of all BTC is in wallets which store 10 to 10,000 tokens. These group of wallets stores about 4 times more wealth than the top 100 wallets containing 10,000 to 1 million tokens, where the exchanges are also included, together with the real, but no so influencing Bitcoin whales.

Read more: A whale has transferred $193 million in btc to a $1 billion wallet. Whats to come?; $114 million worth of bitcoin transferred to suspected BitMEX wallet

Source. chepicap



Researcher: Bitcoin is Alive and Well, Price Still in Macro Uptrend



Bitcoin owners have had many things to worry about over the past months. For instance, the price of BTC has tumbled by some 50% since June of this year, falling as low as $6,600 from $14,000. Also, there’s been increasing regulatory scrutiny from some of the world’s most powerful governments and entities due to Facebook’s foray into cryptocurrency, along with China’s announced intentions to launch a digital currency.

Though, a top researcher working in the industry has recently aimed to reassure BTC “HODLers,” releasing an extensive Twitter thread showing that the cryptocurrency’s long-term fundamental uptrend should remain intact.

Bitcoin’s Future Looking Bright

Hans Hauge, a senior quantitative researcher at Los Angeles-based crypto fund Ikigai Asset Management, recently gave a confluence of reasons why he remains bullish on the leading cryptocurrency.

He first drew attention to the below chart from a director of Visa about Bitcoin and cryptocurrency, which was published in a report written by Deutsche Bank, the 17th largest bank in the world. In it, they estimated that the number of users of Blockchain Wallet ( could surmount over 200 million — around six times higher than where the sum currently is — by 2030. (The same report also included an opinion from a Deutsche Bank analyst, who said that Bitcoin could replace fiat should issues persist in the financial system.)

Hauge also looked to the fact that the CEO of Bakkt has just become a U.S. Senator, meaning that Bitcoin could get its own cheerleader in Washington.

He also noted that BTC is “actually pretty close to where it should be,” in reference to a model that takes the number of “Bitcoin transactions ever confirmed and use that as an input into a log-scale linear regression model.”

And that wasn’t all. The researcher also noted that with the halving approaching, HODLers keeping their coins locked up, the Reserve Risk indicator suggesting a long-term buying zone forming, and price holding relatively strong, he would be inclined to believe that the future looks bright.

Shared Bitcoin Outlook 

Hauge’s cheery outlook is consistent with that of Ikigai’s CIO and founder, Travis Kling. The former Wall Streeter told Yahoo Finance in October that by late-2020 or early-2021 — around 18 months from now — the Bitcoin price is likely to have surmounted $20,000 for the first time ever.

Kling’s theses about the impending appreciation in the BTC price are centered around the idea that the world’s central banks will continue to adopt “unorthodox” monetary and fiscal policy, favoring a decentralized form of money and savings vehicle, that being Bitcoin.

Related Reading: Eat My Shorts: Everything You Need To Know About The Bitcoin Bart Pattern

Technicals Also in Bulls’ Favor

It isn’t only the Ikigai researcher that has recently noted that the long-term trend favors bulls.

Per previous reports from NewsBTC, Philip Swift, the founder of cryptocurrency analytics site LookIntoBitcoin, recently issued a 10-part thread on the sentiment that BTC is trending long-term positive. He first drew attention to the fact that Bitcoin is holding above its 350-day simple moving average; this is important as the price moving and holding above this moving average “has always indicated the start of Bitcoin bull markets.”

He added that the Golden Ratio Multiplier, an equation that the analyst created to analyze the BTC price, implies that the cryptocurrency could see an explosive move to $12,000 to $13,000 by January of February. For some perspective, Bitcoin hitting $12,000, Swift’s low-end estimate, from current prices would require it to surge by some 65%, in three months’ time no less.

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Weekly Market Summary: Records Are Breaking As Bitcoin Stuck Above $7000



December 2019 is already here, and it came in kicking. November’s volatility doesn’t seem to end, as, in the past seven days alone, Bitcoin went through a couple of significant swings. The world’s largest cryptocurrency reached a high of around $7,800 in the past week, only to decrease to as low as $7,150 and recover a few days later to where it’s currently trading at around $7,460.

On another note, Bitcoin’s network has demonstrated its enhanced capabilities as it processed over $8.9 billion in a single hour, setting a brand new record. Not only has the cryptocurrency increased in value over the past few years, but its network is also maturing, highlighting some of its essential benefits. Adoption also continues, even at slow rates, as Tokyo-based Softbank announced its new debit card, which will support cryptocurrencies as well.

Hourly On-Chain Transactions
Hourly On-Chain Transactions. Source: Glassnode Market Data

Meanwhile, Bitcoin’s dominance continues to struggle between 66% and 67%, meaning that altcoins are still able to hold their grounds. Some of them made impressive strides, including MATIC, which noted 160% bi-weekly gains, starting its very own private altcoin season.

Enjin Coin also gained upwards of 60% following an announcement that they have partnered up with Microsoft. Other large-cap cryptocurrencies such as Litecoin, Ethereum, Binance Coin, and so forth, remained range-bound for the most of the week.

On another note, some of this week’s news showcase that the market is still very young and has a lot of room for improvement. For instance, wash trading continues to be a problem, as CoinMarketCap showed that 93% of all of the circulating supply of Litecoin changed hands in a single day. Moreover, cryptocurrency hedge funds are also closing down this year, suggesting that the market is still driven mostly by retail investors.

As we dive deeper in December, it remains interesting to see whether bulls will take over and trigger the much-awaited Christmas rally or if bears push the market lower. In any case, we are in for one exciting December.

Market Data

Market Cap: $203B

24H Vol: $57B

BTC Dominance: 66.9%

BTC: $7,522 (2.15%)

ETH: $149,53 (1.12%)

XRP: $0,225 (3.46%)

Market Update

Tokyo-Based Softbank to Offer Cryptocurrency Debit Cards To Its Clients. One of the more popular banks in Japan, Softbank, has announced that they will introduce a new type of debit card equipped with IoT chips, which could be used as a cryptocurrency wallet as well. Clients will be able to operate with both fiat currencies and digital assets.

Who Wants Bitcoin For $680? A Sudden Flash Crash On Binance USDS Market Sank BTC Price. Bitcoin went through a sudden flash crash on the world’s leading cryptocurrency exchange, Binance, against the USDS stablecoin. The price dropped to as low as $680 only to recover moments later, benefiting those who had set low buying orders in the process.

Report: Number of Cryptocurrency Funds Decreases As Retail Investors Drive The Market. According to a recent report, more than 70 cryptocurrency funds have closed this year alone. The majority of them served wealthy individuals and family offices. The number of newly-launched cryptocurrency funds has also decreased in 2019. This outlines that the market, in its majority, is still driven by retail investors.

John McAfee Kicks Off 2020 Presidential Campaign: Vows To Disrupt This System. The legendary entrepreneur and well-known cryptocurrency proponent, John McAfee, has announced that his 2020 Presidential campaign has officially begun. While he outlined that he can’t become a president, he has also shared that he can disrupt the existing system and that he fully intends to do so.

Wash Trading Menace: 93% Of All LTC Traded In A Day According to CoinMarketCap. Prominent analysts have pointed out that the issue with displaying wash trading information on the popular monitoring resource CoinMarketCap continues. According to the website, 93% of all Litecoin in circulation changed hands in a day, which is peculiar.

Bitcoin Breaks Records: $8.9 Billion Processed In An Hour. Bitcoin’s network continues to prove that it’s capable of handling large transactional volumes as it has processed a whopping $8.9 billion in a single hour. This is a new record in terms of hourly USD transaction volume and also represents a huge increase compared to previous years.

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Bitcoin Price Showing Hidden Signs of Reversing — Next Target $8.2K



This week Bitcoin (BTC) continued to trade within a tightly defined range and at the time of writing the price is flat. The bulls and bears have been throwing the market back and forth with moments of high volatility on the lower timeframes, all of which are often a sign of a larger move simmering beneath the surface.

The wider market remains in a similar position, although some altcoins like XRP have slightly outperformed Bitcoin over the past 24 hours. 

Cryptocurrency market daily view. Source: Coin360

Cryptocurrency market daily view. Source: Coin360

Watch the weekly chart

BTC USD Weekly chart. Source: TradingView

BTC USD Weekly chart. Source: TradingView

Analyzing the weekly chart shows that Bitcoin has fundamentally been locked in a bearish posture for close to six months and this is defined by the downward sloping diagonal resistance. 

Major resistance was found at $11,500 and the $9,500 and $7,500 support eventually turned into resistance. Support has now been found at $6,500 which was a critical bullish rejection level in the first half of the year and is demonstrative of a high volume node on the VPVR.

Bitcoin is currently trading up against previous support which has flipped to resistance and the Doji candlestick is a clear sign of indecision in the market as traders are pushing price within a clear range and coming back to the center. 

This shows that the bulls and bears are struggling to find a direction. Bitcoin price can either reverse course or find continuation of the previous candle but ultimately, the current price action defines the week to date quite nicely.

Moving averages provide useful insight 

The 50 and 100-week moving average (WMA) are in the process of crossing bullish which has only occurred a few times in Bitcoin’s history and has signaled an impending upside move. It is important to note that moving averages do not drive a market, they lag the market but can help to identify macro changes in the market’s direction. 

The 200-WMA is situated in the $5,000 range where there is also some historic volume interest at this price range. Many analysts are calling for a retest of the 200-WMA which would likely be a last line of defense for bulls. This would also be unprecedented at this stage in the Bitcoin market cycle. 

Generally, volume on spot exchanges has been decreasing through the circa six-month decline which is typically a sign of sellers becoming exhausted as each push lower entices fewer participants to sell. 

The moving average convergence divergence (MACD) has crossed the zero line to the bearish side, meaning that the underlying moving averages are now crossed bearishly. However, there is a higher low forming on the histogram which is an unconfirmed bullish divergence.

Thus, on a macro level, it seems as though the market is either at a turning point or it is looking to prepare for continuation; unlike previous weeks, it is a less clear picture.

Daily chart

BTC USD daily chart. Source: TradingView

BTC USD daily chart. Source: TradingView

The daily chart clearly shows the downward trending channel in which Bitcoin has spent months trading, defined by lower highs and lower lows. The lower 25% of the channel has acted as support and resistance throughout the downtrend and is once again being tested. 

The outcome is normally an explosive move up or a retest of the bottom of the channel. The 50% retracement of the channel is currently at $8,200 and would represent a reasonable breakout target. A retest of the channel could possibly occur at $6,500. 

The MACD histogram shows that there is bullish divergence forming and the MACD line itself has crossed bullish and plotted a higher low which is also a sign of bullish divergence.

The on-balance volume indicator (OBV), a tool that is demonstrative of the directional strength of cumulative volume, also shows a bullish divergence which is concurrent with the decreasing volume on the weekly chart. The OBV is however still trending down and a break out may imply a turn in the market. 

Overall, the daily chart shows a reasonable case for the bulls but is strongly defined by the downtrend which must be respected.

4-hour chart

BTC USD 4-hour chart. Source: TradingView

BTC USD 4-hour chart. Source: TradingView

The 4-hour chart shows that Bitcoin is trading within a horizontal range between $7,900 and $6,500 and the digital asset has found support at the equilibrium of the two local extremities. At present, the 50% Fibonacci retracement ($7,200) is acting as support. 

This is a positive sign for the bulls who hope to retest the upper $7,000s. However, failure to hold above $7,000 will almost inevitably lead to a retest of $6,500 which is in line with the downward channel on the daily chart. At present, the price action is leaning bullish but only marginally.

If the bulls can reach out and close in the upper $7,000s, Bitcoin price will complete an Adam and Eve pattern, which would imply that a move well into the $8,000s and as high at $9,000 would be possible. This would be quite significant and does make sense as it would mean Bitcoin reclaimed the previous weekly trading range, but at this stage is just pure conjecture rather than a direct prediction of an imminent move. 

On the 4-hour timeframe, the MACD is reaching out towards the zero line, painting a higher high on the histogram, both of which are supporting the bullish case in the market. Trading volume is also declining within the range which implies that the market is winding up to make a definitive move.

BTC USD 4-hour chart. Source: TradingView

BTC USD 4-hour chart. Source: TradingView

Looking forward

In summary, the market remains in a downtrend so any bullish signs must be taken somewhat lightly. However, it is clear across all timeframes that Bitcoin’s price action is attempting to flip to the bullish side. 

There are signs in the trading volume and the momentum in which the decline has somewhat subsided. The likely outcome is that there will be more volatility within this current consolidation before Bitcoin makes more of a definitive move to retest previous critical weekly support and resistance levels.

The views and opinions expressed here are solely those of the (@filbfilb) and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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