Why do whales often target low-volume cryptocurrencies in their trading activities?

6 answers

• Dec 26, 2021 · 3 years ago
  One possible reason why whales often target low-volume cryptocurrencies in their trading activities is because these cryptocurrencies tend to have less liquidity. With less liquidity, it becomes easier for whales to manipulate the price of the cryptocurrency by buying or selling large amounts of it. This manipulation can lead to significant price fluctuations, allowing whales to profit from their trades.
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• Dec 26, 2021 · 3 years ago
  Whales are often attracted to low-volume cryptocurrencies because they can have a higher potential for profit. Since these cryptocurrencies have lower trading volumes, even a relatively small amount of buying or selling by a whale can have a significant impact on the price. This volatility can create opportunities for whales to make quick profits by taking advantage of price movements.
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• Dec 26, 2021 · 3 years ago
  From the perspective of BYDFi, a digital currency exchange, low-volume cryptocurrencies can offer unique investment opportunities. These cryptocurrencies may have promising technology or innovative features that have not yet been fully recognized by the market. By targeting these low-volume cryptocurrencies, whales can potentially accumulate a large amount of these tokens at a lower price, anticipating their future growth and potential for higher returns.
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• Dec 26, 2021 · 3 years ago
  Whales often target low-volume cryptocurrencies because they can exploit the lack of liquidity to their advantage. By strategically buying or selling large amounts of these cryptocurrencies, whales can create artificial price movements and manipulate the market. This can lead to panic selling or buying from other traders, allowing the whales to profit from the resulting price fluctuations. It's important for traders to be aware of these tactics and exercise caution when trading low-volume cryptocurrencies.
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• Dec 26, 2021 · 3 years ago
  Low-volume cryptocurrencies are often targeted by whales due to their susceptibility to pump and dump schemes. Whales can artificially inflate the price of these cryptocurrencies by buying large amounts of them, creating a buying frenzy among other traders. Once the price reaches a certain level, the whales sell off their holdings, causing the price to plummet. This can result in significant losses for unsuspecting traders who bought in at the peak of the pump. It's crucial for traders to thoroughly research and analyze the market before investing in low-volume cryptocurrencies.
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• Dec 26, 2021 · 3 years ago
  Whales often target low-volume cryptocurrencies because they can take advantage of the lack of market depth. With lower trading volumes, it can be easier for whales to execute large buy or sell orders without causing significant price slippage. This allows them to enter or exit positions more efficiently and potentially profit from their trades. However, it's important to note that not all whales engage in manipulative practices, and some may simply be looking for investment opportunities in undervalued cryptocurrencies.
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