Crypto Whales, Exchanges & Regulation


The news over the weekend has focused on what has appeared to be a mass sell-off of major cryptocurrencies, with Bitcoin prices having at one point during the weekend lost almost a fifth of their value, resting well below $50,000 currently.

The interesting thing to notice here is that whilst the sensationalism is directed at the losses in value, and Bitcoin prices having slipped a further 3% today to $48,130 which is not showing the true picture.

There has been a sell-off among smaller holders, but the Whales have been transferring huge amounts of cryptocurrency from well known venues into unknown areas of storage.

Just this morning, a series of Twitter reports showed a lot of whale activity in that direction, a whale being an entity or individual which holds large amounts of cryptocurrency, often enough that they have the potential to manipulate currency valuations.

During the morning hours in Europe, it tweets showing that two whales transferred huge amounts out of Binance into unknown wallets, the first being $118,997,560 and the later being $39,904.971.

That is a staggering amount to transfer, and whilst there is no information on the location or status of these whales, it either means that these were sold off, and therefore contributed to the price decline, or they were transferred out for another reason and retained.

However, whilst the overview makes it look as though there is a bearish tone in the market and that a sell-off has been universal, it may well be worth looking at how active exchanges are now garnering the attention of whales with enormous stores of cryptocurrency.

Whilst the aforementioned whales transferred out of a well known exchange into an unknown wallet, there has been a deluge of whales who had been holding vast amounts of cryptocurrency in cold storage that have now activated them and brought them into active cryptocurrency exchanges.

Just four days ago, on December 1, when the Bitcoin value was around $56,000, many whales who are long-term Bitcoin holders extracted vast sums from their cold wallets.

During that day, $840 million worth of cold-stored Bitcoin was put onto exchanges, according to data from BTCParser, which is a crawler that analyses Bitcoin activity on a block by block basis.

Given this much activity by whales whose store of Bitcoin had been dormant until just under a week ago, it may be that large sales were made once these coins became active once again on exchanges, hence the downward direction.

This perhaps highlights one area of importance, that being the confidence now displayed in the crypto exchange infrastructure and reliability if almost $1 trillion of previously dormant Bitcoin was put onto digital asset exchanges in just two days.

When looking for an exchange, it is vital to look for regulated venues which have a history of stability. CoinMetro has been fully regulated since its establishment and operates the go-to fiat on and off ramp for all digital currencies, as well as having a fully licensed payment processing facility which carries an Electronic Money Institution (EMI) license.

When transferring large amounts of Bitcoin, conservative holders of cryptocurrency who would perhaps hold vast amounts of coins in cold storage would likely be concerned about transparency and efficiency when re-admitting their coins onto the live market.

Many will have lived through the times a decade ago when unregulated exchanges simply vanished, taking client funds with them, and when regulators and law enforcers around the world clamped down on crypto entities which bilked their customers.

CoinMetro is in a class of its own when it comes to security and credibility. The company was founded as a regulated entity by professionals with years of expertise in the financial markets sector.

In the next few months there are plans to establish a multi-lateral trading facility (MTF) which means that CoinMetro will combine a regulated digital asset exchange with a regulated payment processing facility and an MTF, meaning that it will be a challenger bank in its own right with multi-asset cryptocurrency accessibility.

Given this level of demand in what is now a highly developed market, there is only one way to provide access to live crypto markets, and that is to do it properly.