A crypto evangelist shares why he is concerned that Bitcoin whales will gain more influence in the market – and explains why he is “betting everything on altcoins”

There are whales migrating through the waters of Bitcoin.

  • Bitcoin whales are having an unhealthy impact on the market, crypto bull David Gokhshtein told Insider.
  • Still, the world’s most famous cryptocurrency should stabilize and soon rise to $ 70,000.
  • Altcoins are better than stablecoins – especially two that are severely undervalued, Gokhshtein said.
  • Check out Insider’s business page for more stories.

Mysterious “whales” lurk in the troubled waters of Bitcoin trading and have enough power to manipulate the market, fears longtime cryptocurrency influencer David Gokhshtein.

Bitcoin whales, or companies that own huge amounts of the world’s largest cryptocurrency, have the power to rock the digital asset at will by unloading supply in the market, causing panic selling among small retail investors.

Whales can then ramp up Bitcoin at lower prices, often causing a rally among retail investors, and then “flush and repeat” by booking a profit and dropping the offer again, said Gokhshtein, CEO of Gokhshtein Media, a cryptocurrency-focused media company . and PAC Global, a digital currency payment network.

Bitcoin’s feverish rally in late 2020 was whale-fueled, causing smaller investors to buy high and sell low, according to a December report by cryptocurrency exchange OKEx.

“Whales and institutions are in business to buy low and sell high,” the report said. “… They are trying to drive the market forward, panic retailers and seize opportunities to buy relatively cheap coins.”

According to BitInfoCharts, over 38 million addresses are linked to the 18.7 billion Bitcoins in circulation. Each of these coins is currently valued at approximately $ 34,000, combined they are worth $ 638 billion.

Only 16,072 addresses – or 0.0004% – own at least 100 Bitcoin, which is worth $ 3.4 million. These whales control 11.8 billion bitcoin, or 63.2% of the outstanding supply – a stake worth $ 400 billion. Addresses with at least 10 bitcoins worth about $ 340,000 control 85.9% of the supply.

Bitcoin promises a financial future without government interference, although this inadvertently opens the door for whales to take control of the market. Four addresses have Bitcoin valued at $ 23.2 billion.

“Having these whales is unsettling, but how do you get rid of them?” Gokhshtein said in a recent interview with Insider. “You control the market … it feels centralized when something like this happens.”

Nobody knows exactly who the whales are, but Gokhshtein has his suspicions.

China has continued to reiterate anti-Bitcoin rhetoric and crack down on cryptocurrency mining, making the operation more profitable than ever for the remaining miners. According to estimates by the University of Cambridge, around 65% of bitcoins were mined in China in April 2020.

“I think it could [Chinese] Government, ”said Gokhshtein. “… The elites in China are definitely into Bitcoin. The more they go forward and spread fear, the more they accumulate. Well, they don’t get my bitcoins, so I might not care. “

Although whales are making Gokhshtein restless, he’s still optimistic about the world’s largest digital currency. Indeed, the presence of large investors and institutions gives Gokhshtein confidence that Bitcoin’s rise into the mainstream will be permanent.

Bitcoin’s staggering 1.479% rally from its March 2020 lows to its mid-April high of $ 64,863 has slowed in recent months, but bearish calls of $ 20,000 are “wishful thinking,” Gokhshtein said. He sees that in a worst-case scenario, Bitcoin will slide to 25,000 US dollars before it hits 40,000 US dollars and then climbs to new highs in the region of 70,000 US dollars as early as the end of July.

“People would like to see it go back to $ 9,000 because they’re pissed off that they missed it [the rally]“Said Gokhshtein.

“Everything in Altcoins”

Altcoins, or non-bitcoin cryptocurrencies, are a better way for bitcoin bulls to diversify than stablecoins or even bitcoin-linked stocks like Coinbase or MicroStrategy, Gokhshtein said.

Two altcoins, Chain link (LINK) and Speckle (DOT) are particularly tempting, Gokhshtein said, and he’s adding to those positions despite volatile prices. He said he saw both altcoins rise from around $ 20 and $ 17, respectively, to $ 350.

“Right now, I think the altcoin market is so undervalued,” said Gokhshtein. “If you have Chainlink and Polkadot at current prices, I’ll be right there with Altcoins. I will not keep my money in stable coins. … Right now I see so much money in the altcoin market, it’s ridiculous. “

Chainlink is an “oracle” network designed to provide blockchain networks with external or “off-chain” data on financial markets and other relevant information. A majority of blockchain networks are now using Chainlink, Gokhshtein said, and its influence is likely to increase.

“Protocols must have an oracle, and they are the prime oracle in the game,” said Gokhshtein.

Polkadot is a “multichain” network that was developed to enable fast and secure payments by interconnecting decentralized blockchains. Gokhshtein said he bet that Polkadot will be an important addition to the Ethereum network thanks to Gavin Wood, who created Polkadot and co-founded Ethereum.

But right now, Bitcoin’s fluctuations are mostly driving smaller coins – for better or for worse. That means Bitcoin whales could have some impact on the $ 1.44 trillion cryptocurrency market.

“This entire market is pure speculation,” said Gokhshtein.

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