Know Why You Shouldn’t Panic Sell When Crypto Whales Liquidate PlatoBlockchain Data Intelligence. Vertical Search. Ai.

Know Why You Shouldn’t Panic Sell When Crypto Whales Liquidate

Time Stamp: May 19, 2022 11:53 AM

Here’s-Why-You-Shouldn’t-Panic-Sell-When-Crypto-Whales-Liquidate.

Cryptocurrency Whales are specific addresses that usually hold huge amounts of a particular digital asset like Ethereum or Bitcoin. Whales have so much power and influence on the crypto market. As such, they can cause shifts in the crypto prices, causing panic selling. However, employing accurate strategies to assist in overcoming the need to panic sell cryptocurrencies is essential.  Nonetheless, a sign of a well-seasoned investor is not making haste decisions at any sign of market instability. To be accurate, most investors are risk-averse and always want to avoid losses. Regardless, for a good investment, a long-term mindset and logical approach are keys to outsmarting short-term down markets.  Crypto Whales Crypto Whales refer to individuals or groups of people to come together to hold a large share of a specific coin in the crypto market. Whales normally include Bitcoin Investment Funds and Hedge Funds. Among them are Falcon Global Capital, Bitcoin Reserve, Pantera Capital, KPMG, Bitcoin Investment Trust, and Fortress, among others.  The Whales can cause market shifts in prices. An example was an instance in 2014 where someone posted a sell order of 30,000 BTC at $300 each, which was below the mid-300s bitcoin price levels. The large order size spooked the crypto market causing the price to plummet to low levels not witnessed since November 2013.  Based on recent data, the top 3 BTC wallets hold 3.05% of the total coins, that’s equivalent to $37.88 billion. Regardless, good crypto investors know how to ride the waves caused by the whales and make a profit in the long run.  Panic Selling In the crypto world, during an instance of a higher volume of sell orders that beats the volume of buy orders, a decline is witnessed. It’s often a result of a panic sell, caused by investors who don’t want to incur huge losses due to the digital currency’s volatility.  Panic selling occurs during the dawn of major events and in turn, forces investors to sell their crypto assets. It also surfaces during periods when short-term investors pull currency prices down, triggering long-term stop losses. Panic selling is also a result of crypto whales’ actions on the market.  Despite crypto price manipulations, there are various reasons why as an investor, you shouldn’t panic and sell when crypto whales liquidate. Here’s why: Every Recession has a Rebound Considering the various events that have shaken the crypto market, every downtrend has been followed by a rebound, either in the long run or the short term. When crypto whales liquidate specific digital assets, they do so with an aim of pumping the crypto prices. Considering the period prior to BTC reaching its all-time high last year, whales were accumulating the digital asset, and the price consolidated under $60,000.  However, considering crypto going mainstream, it’s most likely that their demand will increase leading to crypto whales purchasing more coins. Even so, rebounds are a norm in the market, and panic selling is not the right strategy in yielding great profits.  Panic Selling is Contrary to Sensible Trading Common sense trading dictates selling high and buying low is the way to go. Noticing when whales are selling the crypto assets might be a good opportunity to buy these digital assets. It’s all about the long-term strategy and panic selling goes contrary to the strategy of buying low and selling high.  For example, 2% of network entities hold and control over three-quarters of total BTC.  When Bitcoin whales decide to liquidate, it provides an opportunity for new investors to own more coins.  Opportunities for Bigger Gains As mentioned, when big whales decide to liquidate digital assets, it’s a perfect time to buy coins. Panic selling will always yield short-term returns and is probably a better strategy for short-term investors.  Major cryptos like Bitcoin and Ethereum may experience downtrend surges in prices caused by whales, but they eventually keep growing since major brands are adopting digital currencies. As such, the currency prices will peak leading to bigger gains.  Panic Selling Locks in Losses In a panic sell situation, most investors feel the need to sell their coins since they are worried about losing more in a downtrend. Being in red with investments results in a panic sell in a down market that locks in an individual’s losses. Researching how whales manipulate the market gives you a lead into how you can ride the waves brought about by these giants.   Conclusion Considering the volatile crypto market, investors hoping to see their efforts bear fruits might find it particularly unnerving. It’s human nature to experience fear and want to sell crypto coins and assets during a down market. Selling your investments is more of a personal decision. Regardless, big whales have the power to manipulate the market and this isn’t a reason to drive panic selling. In fact, … Continued

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