Disclaimer: This article is intended to convey more market information and does not constitute any investment advice. The article only represents the views of the author and does not represent the official position of Mars Finance.
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Source: NFTGo
Author: NFTGo
In the cryptocurrency market, giant whales refer to objects that hold a large number of specific tokens – individuals, institutions and exchanges. For example, when it comes to Bitcoin, Giant Whale generally refers to an account that holds 1,000 or more Bitcoins. Well-known whales include MicroStrategy, Pantera Capital and Fortress Investment Group.
Broadly speaking, the NFT Whale refers to an address with more than $1 million in holdings. Giant whales are not only able to make their own profits, but also influence the way investors in the market trade.
As the NFT market moves forward in 2022, the number of NFT holders and "NFT whales" continues to increase. For example, on October 2, 2021, there were 647 whales with NFT positions of more than $1 million, and today, the number of whales has reached 1254. In just half a year, the growth has nearly doubled. At present, the whale holds more than 5 billion assets, accounting for 26.68% of the global market value of $19.2 billion.
The data source NFTGo.io
How is the NFT Giant Whale defined?
Due to the uniqueness of the NFT market, unlike the giant whale model of homogeneous tokens, the NFT market has its own giant whale definition model. The broad term "giant whale" refers to investors who have strong NFT purchasing power and have made considerable profits.
Giant whales tend to have the following characteristics:
Influence: High
Assets: High
Faith: High
Expected Earnings: High
Holding period: Longer
Why track NFT whale trades?
On the one hand, whether it is the reputation or capital of the giant whale, it has a high influence. By copying and trading some famous giant whales, it can bring good investment opportunities and opportunities, and keep abreast of market trends. If the whale starts selling (at or below the floor price Listing), the price is likely to fall. If some giant whale Listings exceed the usual high price, it indicates that the trend of an NFT project is bullish.
On the other hand, the sharp fluctuations in the market are often related to the liquidity of the market – especially market depth and spreads. A giant whale holding a large number of NFTs in a certain Collection can also increase market volatility. Therefore, we also need to pay attention to which giant whales, how much share they hold, and how to influence the market through large-scale trading.
Essentially, giant whales have a chain reaction that affects other investors in the same Collection. You can track accounts with large numbers of NFTs by NFTGo.io whale tracking feature, or follow whale alerts in Discord.
Double-edged effect
The existence of giant whales brings about a double-edged effect, mainly from the two aspects of buying and selling to drive the market.
One is the buying of giant whales. Some giant whales will firmly believe in the value of good projects, and when some projects or market values are reversed, they will buy bottom floor guards for projects they trust. In addition, the soaring price of the project is often related to the large number of whale buying. It's important to note, however, that some giant whales raise the price of a certain Collection by sweeping the floor in large numbers (some of these transactions may involve Wash Trading).
At this time, people start FOMO, entering at the high point of market sentiment, at which time the whales may sell some of their NFTs to make a profit.
One is the sale of giant whales. There are some giant whales that sell list NFT below market prices, causing floor prices to fluctuate, and then people may start to panic and sell their NFTs at cheaper prices. If the information is favorable, the whale may buy at a low level again. In addition, giant whales will also be laid out in advance based on some gossip. It is important to keep an eye on the giant whales.
NFT holder distribution
The data source NFTGo.io
The role of giant whales in the ocean is to eat small fish, through a series of actions such as sweeping the floor to cause fluctuations on the surface of the sea, so what other types of traders are there in the ocean of NFTs?
HODLer- Crab Crab
Traits: We use Crab to refer to people who have a certain understanding of the market, they are often some OGs, project HODLers, firmly believe in their own judgment and the future of the industry (hard shell, rampant courage).
Behavior: Long-term holders tend to support certain projects all the time, while preaching and educating online, and interacting and discussing with each other.
They are less concerned with the short-term sentiment of the market and focus on the long-term development. The NFT assets they buy will appreciate in value over time, or decline. But even if the market value falls, they don't sell immediately. This requires a certain amount of patience, self-discipline and courage, as well as a firm belief in the industry. For these types of participants, there is not even a word of "selling". Instead, they can choose to buy at this time, or not at all.
Influence: High
Assets: Higher
NFT Belief: High
Expected profit: Medium to high
Holding period: Longer
Flipper - Shark Shark
Traits: This type of trader is very sensitive to interests and can be very sensitive to catching projects that can quickly bring benefits, like a shark that pays attention to the smell of blood at any time. The relative fast-forward and fast-out trading model makes it not as large as the giant whale, and it often behaves "aggressively" (very active) in projects, using various means to win whitelists, grab public sales, etc.
Behavior: For Fliprs, they'll learn about every short-term market movement, gas fees for live transactions, and the latest whitelisting. Calculate costs and profits at the same time and make decisions quickly under pressure. Although there are times when they sell out, they can still enjoy the security of a guaranteed income.
Influence: Change
Assets: Medium
NFT Beliefs: Low
Expected earnings: Medium-low
Holding period: short
Newbie - Shrimp Shrimp
Traits: Shrimp Rice is a synonym for newcomers to the NFT market.
Behavior: Will float back and forth with the market movements, and actively listen to the suggestions and opinions of the other traders mentioned above. Wrapped up in market sentiment, trading behavior lacks opinion, and it is easy to chase high, FOMO, etc.
Influence: Small
Assets: Smaller
NFT Beliefs: Low
Expected profit: Low
Holding period: Medium
Collector - Octopus
Traits: Octopus likes to collect shells to build fortresses. Like octopuses, people like collectors who like to collect collections of higher artistic value are often part of high purchasing power groups.
Behavior: They buy NFTs primarily to treasure rather than make an immediate profit, but they also communicate with the creators to understand the creators themselves, the value in the work, and to think about the information behind the images, as well as the connotations and stories. Artistic value is more attractive to them than value-added space.
Influence: Medium to high
Assets: High
NFT Faith: Medium to High
Expected profit: Medium to high
Holding period: Long
Gambler - Pearl shells
Characteristics: Extremely unique NFT investment logic group, like to collect small pictures of chart dogs or popular project imitation disk types, is a follower of the meme style, the cost is very low, and the bet is market sentiment. But in the end, they will find that what they harvest is either pearls or empty shells. They don't necessarily believe in how good the future holds for NFTs, but they do follow the FOMO sentiment All in.
Behavior: Such participants do not care much about the project roadmap, project ecology, value estimates and airdrop prospects when making decisions on entry, and the discovery of meme attributes and innovation will become the loudest charge when they make decisions.
Impact: Low
Assets: Medium
NFT Faith: Low
Expected Earnings: High
Holding period: short
Gamer - Penguin Penguin
Traits: Penguins spend most of their time ashore and a little time into the sea. These people are mainly participants in GameFi, because of the combination of GameFi and NFT, they become NFT Holders. On the one hand, they hold NFT tickets mainly for GameFi projects, and the timing of entry and sale depends on the economic model of the GameFi project and the daily changes in new users. They are stationed in the far South Pole, and any fluctuations in the PFP ocean will not affect the NFT collection changes of such players.
Behavior: For this type of trader, NFT is more inclined to be the corresponding GameFi project should be pledged pieces, once the pieces choose to pledge and transfer to the project side's pledge address, the empty OS home page will not disrupt their unique money-making thoughts, perhaps the empty home page is the maximum benefit of such traders' logic.
Impact: Low
Asset: Medium
NFT Faith: Low
Expected Profit: Medium
Holding period: medium to high
The different category proportions will set the tone for the community
The data source NFTGo.io
Many people don't just have one trading style, and when choosing between different types of traders, it's important to take into account your financial situation, risk appetite, and your long-term goals.
As @mentalist420 said,
"There are investors and there are collectors".
The proportion of different types of projects will affect the future direction of the project, just think, if more than 80% of the project is speculative, then the project is likely to be directly zero after the market hype. But if the project is mostly HODLer, the project may develop well. This also has some enlightening implications for the creators of NFTs:
Was your Collection created for NFT Collector or for NFT Investor?