In the space of just two days in late August, Bitcoin dropped from $10,260 to $9,430. This was an 8% drop, which may not sound like much but for such a short space of time, this is actually quite steep. Since it is still early days, it is not possible to fully understand why this happened, however, some traders and enthusiasts are suggesting that it could be the result of foul play. It is possible that whales could have tanked the market by selling a large quantity of crypto funds all at once.
What is a whale?
For those who are new to the world of trading, a whale is a person (or organization) who has extremely large buying and selling power. They either buy substantial quantities of a cryptocurrency all at once or sell large quantities all at once; oftentimes doing both over a short span of time.
Whales are a problem for all financial markets, however, the (still) somewhat unregulated nature of cryptocurrency means that they pose an especially serious risk to market stability and transparency. When a whale buys or sells their coins and tokens all in an instant, it can cause artificial rises or falls. These punish the small trader, and by extension, the industry.
Why regulation might not be the answer
So far, the crypto markets ha...