How to Start Trading Cryptocurrencies: Actors and Players to know before trading Bitcoin, Litecoin, Ethereum and Ripple
8 min Beginners Beginners
Dear crypto owners, What are you? A Whale, a Money Maker or a HODLer? The blockchain is a different world and trading in cryptos is a different ballgame altogether. If you are in the game you need to know who is who on the market. This article is all about that.
We start with the big guns first: Whales. A whale in the crypto world is a guy or a group of people who have a capacity to manipulate the crypto market with their massive amount of crypto wealth that they have accumulated over a period of time. At times these are also big institutions, who although have only started entering the crypto world recently, have deep pockets and would usually trade in the hundreds of thousands of Bitcoins, for example, at one go and can take markets into their own direction without caring which side others are at. So, it makes sense for the “small fish” to know who and what side these whales are so that to know which way the crypto market is headed and profit from the trade accordingly.
Bitcoin’s creator Satoshi Nakamoto is known to be the biggest whale in the ocean of cryptocurrencies, who is said to be holding about a million Bitcoin.
Whale impacting Bitcoin price
On November 12 last year, a whale sold 25,000 Bitcoins worth $159 million. Such was the impact of the order on the price that the largest cryptocurrency fell more than 12% on the day to $5,555.5500.
The news soon rippled through online forums, with bitcoin traders arguing about whether it meant the owner was about to sell the digital currency.
No, that’s not a typing mistake, really. That is the term used in the crypto world for the investors who prefer to hold on to their position even if it is in the loss for time being. HODL is “Hold On for Dear Life” or HOLD for crypto investors. Although it all started with a small typo on a social media forum, Redditt, by a user called GameKyuubi, but as happens in today’s fast-paced social media world, it became a meme sort of and soon became a trend and now any investor who owns and stays invested in a particular cryptocurrency is known as a HODLer.
That particular Redditt post has already been read by more than 700,000 times and was written first in 2013. Since then, any investor who holds on to a particular crypto calls himself a HODLer on any social media platform, particularly on Redditt, Twitter, and Telegram.
There are many Twitter users who are big influencers and HODLers themselves and investors follow them quite regularly for views and trading tips. Twitter user @rogerkver (Roger K Ver) for example, based out of Tokyo, with more than 500,000 followers, is a known Bitcoin Cash HODLer.
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Being a HODLer
If you are buying a crypto just for the sake of capital appreciation without even believing the potential of its business, then you are not a HODLer in its true sense.
Just as we have day traders in the currency, equity or a debt market, we have them in the cryptocurrencies world too, they are called Money Makers here.
Similar to their breed, they trade on both sides of the swings and make money by either shorting (selling first without owning it and then buying it back at the lower end) or going long (buying first at a lower level and selling at higher).
The Money Maker traders have a knack for the technical charting tools and also have a big influence on their followers, especially on Twitter. A Twitter user such as @PhilakoneCrypto, based in Canada with 94,300 followers is one such Money Maker.
Heart of steel
The term money maker sounds easy and appealing, but is harder and difficult to practice. Given the volatility in the cryptocurrency market
one needs a heart of steel to trade in and out on a daily basis to make money more often than lose money to be a successful money maker.
How are they different?
A Whale, a HODLer and a Money Maker, they all are very much required to complete overall character of the cryptocurrency market. While a Money Maker cannot influence the market the way a Whale does, but a number of such money makers would play a role of that of a market maker that we see in other markets such as currencies and debt.
Similarly, too many Money Makers would also make an already highly volatile crypto market even more volatile. So to balance things out, a HODLer plays a suitable role. A good number of HODLers chipping into the market from time to time ensures there’s stability in the market.
These players are the essence of the market and make what we call a perfect market and balancing things out in a world which is dogged by too many hacks, scams and regulatory concerns.
The information provided by FXStreet does not constitute investment or trading advice and should be just treated for informational purposes. Our content may also include affiliate links or advertising from other websites, however we are not responsible or liable for any actions of other websites. Investing in Cryptocurrencies involves a great deal of risk, including the loss of all your investment, as well as emotional distress.