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The bitcoin market, which is dominated by bitcoin whales: 1,000 people control 40% of bitcoin

As long as a handful of investors can make huge changes in the Bitcoin market.

On November 12 this year, somebody transferred nearly 25,000 bitcoins to an online exchange, which at that time had a total value of about 1.59 billion U.S. dollars. The news quickly spread across online forums where all bitcoin investors are talking about whether the holder of the bitcoin is selling his digital currency.

Holders of large amounts of bitcoin are often referred to as bitcoin whales, and they are also a group of investors who are worried that as long as they sell even a small portion of bitcoin in their hands, they all cause a plunge in the price of the currency , And this is more likely to happen when the current price is almost 12 times higher than the beginning of the year.

Forty percent of bitcoin is held by about 1,000 users, and as the current bitcoin prices are already quite high, perhaps each of them may want to sell half of bitcoin, Aaron Brown, former managing director of capital at AQR, said. More importantly, there are few precedents for these bitcoin whales. These big guys probably know each other for years, they can stick with the bitcoin from the early ones, so they're likely to join forces to provide support or boost to the market.

"I think there should be hundreds of people," said Keulsamani, managing partner of Multicoin Capital. "They might talk to each other often," says Carrie Ross, a safety lawyer at Ross & Shulga. We need to think about one Reason: At least some information sharing is legal. Because bitcoin is a digital currency and not a guarantee, there is still no act that now bars individual groups from raising prices by buying a lot of bitcoins and then selling them in a short period of time.

Regulator is difficult to keep up with the pace of cryptocurrency transactions, many provisions are still not clear. If traders not only pushed up the price of bitcoin, but also spread rumors online, this behavior should be characterized as fraud. Bittrex, a digital currency exchange, recently warned its users that their account will be frozen if the platform suspects that individual users are involved in activities that manipulate currency prices. There may be different rules for other digital currency laws, and according to the SEC's mention, some digital currencies can be treated as currency by judging the structure of digital currency and how investors can profit from it.

When asked whether all the big men would act at the same time, Rogerfort, a well-known early bitcoin investor, said in an e-mail. "I suspect this may be true and people can use their money to do what they want Though for me personally I do not have time to think of these things. "

"Any asset class, big family, and large institutional holder can work together to manipulate prices," said Alibaba, co-founder of BlackTower, in an electronic message he wrote: "In the digital money arena, this artificial manipulation More because these markets are just emerging and the assets are naturally speculative. "

The recent rise in bitcoin prices is hard to explain because bitcoin has no inherent value. Originally started in 2009 by a white paper written by an anonymous person, Bitcoin is a digital transactional system maintained by an independent computer network on the Internet that uses encryption to ensure proper transactions. Its most fanatical believer thinks it can replace banks and can even replace traditional legal currency, but its value depends on whether people are willing to use it to trade, which also makes the price of bitcoin very volatile.

Like most hedge fund managers who specialize in cryptocurrencies, Samani often tracks the trading-active addresses of the big Bitcoin builders (although Bitcoin transactions are anonymous, but everyone can see Encoding address). When he sees the dynamics of the address, he immediately calls potential sellers, often giving him access to the motivation and trading plan of the seller. Some funds do not go public and buy bitcoins directly from another fund, thus avoiding any price shocks. "Investors and investors all help each other," Samani said. "We all know each other, and we all help one another or share information, because we all want to make money." Rose said it is legal to at least collect intelligence.

Of course, ordinary investors do not have enough prestige to have a millionaire pick up their phone, but they can track the big addresses and market dynamic discussions on Reddit by endorsing plans and motivations for those bitcoin whales I do not know. "There is no transparency in this market," said Martin Martin, a lawyer focused on bitcoin. "Every detail about trading resources should be made public in the securities market, but you have a hard time making it in the virtual money world Clearly what happened next. "

This disadvantage of ordinary investors in investing in smaller digital currencies and tokens can be even more pronounced. Spencer Bergt, managing director of Blockchain Capital, said bitcoin has the lowest currency concentration among all the currencies in which people invest. According to Alex Seinaborg, cofounder of Tetras Capital, a cryptocurrency hedge fund, the top 100 addresses in the largest holdings hold 17.3% of the issued bitcoin, but the bitcoin rival Ether Said that the top 100 address holds 40% of the currency, other currencies such as Gnosis, Quantum and Storj, the first 100 addresses hold more than 90% of the currency, many large are members of these project operations team.

"A good analogy is for stocks in the early stages," writes BlockTower's Paul. "Much like those deals, most of the founder and some project investors have the vast majority of assets." Based on Bitcoin's future trends, Other investors think those bitcoin whales will not sell their coins. "I think a little common sense knows that whales who hold a lot of bitcoin and bitcoin cash do not want to ruin any of them," said Kingsman, who lives in Prague and regularly deals with tokens, but once When the price goes up, they do not think so.