MEDIA COVERAGE
A significant portion of Bitcoin media is propagated through platforms where large holders have considerable influence , which can arguably lead to information asymmetry , and amplified price volatility due to the concentrated dissemination of biased or strategically timed information .
“ Podcasts , crypto blogs , and social media channels frequently feature prominent investors who may sway public perception to buoy the market in their favour . These platforms often perpetuate cycles of hype , which are crucial for attracting new investment – akin to the continuous inflow needed in a Ponzi scheme for earlier investors to profit ,” says Zachary Michaelson .
The effect of large holders on Bitcoin ’ s price stability Whales exert a disproportionate influence on Bitcoin ’ s price due to the concentration of substantial holdings among a few individuals . Their capacity to conduct large trades can cause significant price swings because of the market ’ s relatively low liquidity . Whether buying or selling , these transactions can set off chain reactions across the market , either driving prices up with large purchases or causing steep drops with significant sell-offs . Traders closely monitor whale wallet activities for signs of impending large-scale transactions .
This anticipation or reaction can heighten volatility , as even rumours or perceptions of a whale ’ s potential market moves can lead to notable price fluctuations .
140 July 2024