Cryptocurrency has become one of the most interesting things to many Nigerians, particularly the youths in the recent past. Other people perceive it as a means to get out of poverty and some as an intelligent investment. However, with the increasing number of individuals joining the crypto world, there is a very small amount that would be aware of what goes behind the scenes. Something known as crypto whales is one of the strongest factors that drive the crypto market.
These are individuals or organizations that have huge amounts of money in cryptocurrency such that when they convert their coins, they can influence the market. The thing is that, unless you learn about crypto whales, you will continue losing your money no matter how hard you try. In this essay, I will discuss in a layman language what the crypto whales are doing and how they are messing with the market and how we, as ordinary investors need to be smart.
To get a clear understanding of the term whale in the context of crypto, it is only appropriate to first of all, define it. A crypto whale is an individual whose holdings of a particular coin are staggering. This increases the chances of such an owner of thousands of Bitcoin or millions of a smaller token like Shiba Inu being known as a whale. They hold a lot of that coin such that when they wish to sell, or to buy, they probably will create some fire on the market. Suppose that you are swimming in a small river with your friends and then a gigantic whale shows up at the river. It will generate swells that will push everyone. This is what it means when a crypto whale enters trade or exits. They cause big transformations.
The Nigerian crypto market is filled with individuals who get into the market with hopes of making a coin pump. They think they would purchase at low prices and sell at a high price. However, what most people do not understand is that in some cases these coins are being manipulated by whales behind the scenes. They inflate the coin, so that it pulls in loads of little time investors (we say these little time investors are retail investors) and when the value of the coin grows, the whale empties them all. The prices crash and the small investors end up in losses. This is termed as pump and dumping. It is nothing new but rather very common in the crypto world.
Among all methods used by the whales to manipulate the market, they instill fear or excitement. As an example, a whale may dump a huge portion of Bitcoin. By doing this other traders would panic as they think the market is going down. They will also begin to sell in order not to lose.
Social media is another means that whales employ. Have you ever paid attention to how a concrete coin becomes a hit on Twitter, Tik Tok or any Telegram chat? It does not always happen by luck. Whales are also in a position to post fake news or even hire an influencer to push a story. When enough of the population is lured to believe the story and purchase the coin, the whale sells and the coin crashes. The typical Nigerian youths with little capital are facing the problem of losing everything in at most one bad trade. It is, therefore, significant not to believe in a blind advertising. Crypto does not mean joking around but involves being knowledgeable about it.
The other thing which makes whales powerful is that they employ high-technology. Most of them have trading bots which rob the market, monitor trends, and make thousands of decisions in only several seconds. Such speed is beyond the ability of a little investor who operates using phone and data allowance in their package. It is as though a person is chasing someone in slippers and trying to out pace him or her in a Ferrari. The balance is broken in the game. This does not imply that a small time investor cannot make profit but that he has to be exceptionally smart and cautious.
The one thing that most people fail to understand about crypto is that it is designed to be decentralized (which means that there should be no one person in control), it is nevertheless still somehow held in power by people who possess money. When there are a couple of wallets with large amounts of the coins of a project then those individuals will be the real owners of the project. They will be able to determine its future. They are able to crash or pump it. Therefore, when purchasing the coin, you have to make an inquiry on the number of owners of the coin and how much of it they have. It is referred to as verification of the spread of the coin or the whale concentration.
We have to speak also about our attitude. The result is that in Nigeria today, a substantial number of the youths are in dire need to get quick money. They desire to make over-night money doubling. That is why scams, ponzi schemes, and crypto projects are flourishing. Nevertheless, the whales do not act in desperation. They are long term oriented. They also read, They plan and they know risk. It is one of the things we should learn out of them. Neither do we get all emotional and go on to become traders who trade when the markets are screaming and get sold off when the markets are terrified. By doing that, you will continue to lose.
What then can you do to make sure you are not one of the victims of whale manipulation? The first one is how to educate yourself. And do not get into crypto because someone had advised you to. Get acquainted with learning to read the charts, learn how to monitor wallet activity, and how to understand that everything is not in order. It is possible to find sites where it indicates when there are large wallets moving coins. The information can help to make better decisions.
Second, one must have a plan. You also should not want to put all of your money into a single coin. Diversify. In case one of the projects fails, the rest can help you. Moreover, you should determine the maximum amount of money that you are ready to lose before you enter any trade. That should be able to help you not panic and sell out of fear when prices move. Whales prefer to shake off bad hands in the market. Do not feel that you are one of them.
Third, do not be too caught up in FOMO which is a fear of missing out. Doing coin pump and dump Someone pumps a coin up and they are posting screenshots of huge gains, do not just jump in there and have no idea why the coin increased in price. There is the possibility of a set up. Lots of those in Nigeria were just lured into crypto due to the hype only to end up regretting it. There should be no coercion in decision-making.
To sum up, crypto whales are extremely valid and extremely strong. They are behind the scenes and dominate much of the market. Among the things they do in order to manipulate prices are the use of money, emotion, technology, and even influencers. You, as a young Nigerian with the desire to achieve success in the crypto market, have to open your eyes. It is not enough to be thrilled by profit. Pay more attention to the question of how the market actually works. By knowing how the whales think and act, you can stand a better ground. You have to live with them, You can learn to swim smartly around in the same waters. Crypto is also the land of opportunities, and of traps. My own salvation thou wilt scatter or, rather, save thyself in thyself thou wilt confound.