Gain insights into the weight of whale holdings in the top 200 cryptoassets through Coin Kickoff’s analysis, focusing on individual investors who own 1% or more of a cryptocurrency’s total supply.
A couple of weeks ago, Coin Kickoff released the findings of an analysis its analysts had done on the 200 biggest cryptoassets available, specifically looking at the weight of whales. Individual investors that own 1% or more of a certain cryptocurrency’s total supply are referred to as “whales” in this context.
These investors have a significant impact on the value of the asset, in part because smaller investors follow the movements of whales and use them as a leading indicator of potential price changes. In particular, whales have more than half of the tokens for 36 of the 50 largest crypto assets by market capitalization, with as much as 13 coins having more than 90% of the tokens in their possession, according to Coin Kickoff experts.
Whales control the crypto market
In this regard, UNUS SED LEO (LEO), or the Bitfinex exchange token, emerges as the most whale-dominated token, with just two individuals owning 98.95% of all tokens.
The buyback paired with the burn as a result of the May 2019 litigation may be the root of this very strange predicament.
In fact, the parent business of the exchange (iFinex) started a repurchase campaign after the token was released on the market, raising $1 billion.
Tether Gold (XAUT) ranks third with 97.16% whale-held tokens, followed by Huobi BTC (HBTC) with 97.49%. 13 of the top 50 crypto assets have over 90% of their tokens in whale hands, while 23 have 70%. Axie Infinity (AXS) has 94.88%, Gemini Dollar (GUSD) 92.17%, FTX (FTT) 91.2%, and Cronos (CRO) 91.49%.
Other noteworthy cryptocurrencies with substantial whale holdings include Curve DAO (CRV) at 82.76%, The Sandbox (SAND) at 78.98%, Polygon (MATIC) at 71.15%, wrapped tokens SETH and WBTC, True USD (TUSD), Shiba Inu (SHIB), and True USD at 67.77%. Whales hold most tokens in 36 cryptocurrencies, including AAVE, Chainlink (LINK), Uniswap (UNI), and Maker (MKR).
Contrarily, with only 1.15% of tokens in whale hands, Bitcoin is the one that is most evenly distributed. This is because the term “whale” in this research is defined specifically as those who own at least 1% of the total supply.
Satoshi Nakamoto, who precisely alone holds “only” 1.15% of all existing BTC, turned out to be Bitcoin’s lone “whale.” Furthermore, Satoshi hasn’t utilized or transferred those Bitcoin, and many people think he’s deceased.
Regarding ETH, Whales own 22.25% of the available supply, a far bigger proportion than there is for Bitcoin. Dash, Litecoin, USDC, and USDT are all under 30%, and DAI and Bitcoin Cash (BCH) are both under 40%.
The most decentralized system is Bitcoin
The fact that whales control the vast majority of cryptocurrencies is undoubtedly the most intriguing finding, but Bitcoin is also by far the least concentrated of all of them.
It is sufficient to note that it is the only one with less than 5% (really, less than 2%), with Dash coming in second with 8%. However, Dash is currently a project that seems to be dying as Bitcoin maintains its undisputed dominance.
Additionally, only BTC and DASH are below 10% because ApeCoin (APE), which ranks third, already has 11.46% of the tokens owned by whales.
As a result, Bitcoin is almost seven times less concentrated in the hands of whales than the second-least concentrated cryptocurrency and even close to ten times less concentrated than the third.
With a difference of more than 19 times, the distance from Ethereum is obscene.
Although it was already widely acknowledged that Bitcoin was by far the most decentralized cryptocurrency in terms of token concentration, this fact was completely unknown.
The data, on the other hand, completely refutes the widely-held claim that Bitcoin is a cryptocurrency with a large concentration of tokens, in fact overturning it.
Risk factors for concentration
A whale’s ability to influence the market price by, for example, fast selling massive amounts of tokens increases with the number of tokens it possesses.
People who control more than 1% of all tokens in a specific cryptocurrency can easily have a big impact on the markets, in particular.
Actually, the danger is reduced in situations like LEO when the whales are the same issuers that have pulled their tokens off the market since they run the risk of hurting themselves by making a large number of sales.
However, if there are numerous whales and they are unrelated to the people in charge of the token, the risk is very serious. In fact, the price of a cryptocurrency may have even imploded as a result of significant whale sales in the past.
Even on cryptocurrencies like Ethereum (ETH), where whales collectively possess less than 25% of all tokens, their decision to sell would likely have a significant negative effect on the market.
In contrast, the potential impact of a large whale on the price of BTC seems unlikely as it is speculated that the sole significant whale in Bitcoin is no longer active. However, it is important to consider the influence of smaller whales, holding less than 1% of the tokens, who could still exert minimal effects on the market.
It’s also important to remember that, if done at roughly the same time, bulk sales by small or medium-sized holders could still have the same results.