Fears Of Bitcoin ‘Whales’ Manipulating The Market Brought Up, 40% Owned By 1,000 People

Bitcoin has been dominating the financial news market for over a year, with its skyrocketing price being an irresistible headline material. While everyone else was focused on how the cryptocurrency has been increasing in value or how it’s a bubble waiting to burst, some are starting to worry about the so-called “whales.” These are basically the 1,000 or so people who own 40 percent of Bitcoins in the market.

In a recent report, Bloomberg pointed out that despite the recent rush to trade in Bitcoins, a huge portion of the coins actually belongs to only a few people. These traders are often referred to as “whales” due to how many of the coins they possess. As a result, any move they make will often make a huge splash.

One example of how much one of these “whales” can influence the Bitcoin market is the case of one trader moving $159 million worth of the currency on November 12th. This immediately got the attention of cryptocurrency enthusiasts who proceeded to argue as to whether or not the trader intends to cash out.

This imbalance in power has a lot of traders worried, especially because of how the value of the currency is dictated by the market itself. The fact that these “whales” could rock the market by selling even just a fraction of the Bitcoins they hold is causing some major anxiety in a lot of them.

Even more worrying, however, is the possibility of these major players actually coordinating in order to manipulate the market, Fortune notes. In the stock market, regulations prevent individuals from gaming the system too much, with insider trading leading to some severe punishments.

In the case of Bitcoin, however, there is absolutely no oversight. As such, there would be nothing to prevent these “whales” from moving the market in which way they want. Fortunately, it seems these early adopters have huge grudges against each other, so such conspiracies might be less likely right now.