A whale wallet holding massive Shiba Inu (SHIB) tokens is sending funds to centralized exchanges, sparking fears of a potential dump even as SHIB prices struggle to stabilize.
Earlier on Monday, data analytics firm Lookonchain highlighted wallet 0xd6 after it transferred 182 billion SHIB tokens to Gemini and Crypto.com. On Dec 19 2022, the same wallet moved 200 billion SHIB to Crypto.com, leading to the price dropping hours after the transfer.
“The last time he transferred $SHIB to Cryptocom dropped the price of $SHIB by 7%,” wrote the firm.
Data from Etherscan shows that this “smart money” wallet first bought 15.28T Shib with 10ETH valued at around $3,796 on August 7, 2020. The whale then made 1,967 ETH ($7M) by buying and selling SHIB on Uniswap before growing its holdings further by buying SHIB low and selling high on exchanges like Binance and Crypto.com.
At press time, the wallet held over 3.1 Trillion Shiba Inu tokens valued at slightly over $40 million at current prices. This is slightly over 0.31% of the total Shiba Inu token supply.
Meanwhile, Shiba Inu is not the only cryptocurrency that has seen whales sending massive amounts of crypto to cryptocurrency exchanges. On Feb 25, one of the largest Dogecoin (DOGE) whales in existence sent 190.8M DOGE worth about $15.5M to Binance, according to data from Dogechain, the whale currently holds 352.5M DOGE valued around $ 29M, placing it in the top 20 Doge whales category.
Huge token transfers by whales can be dangerous, considering sending tokens to centralized exchanges raises the possibility of the holder selling them. Whales have the potential to move the market with their decisions in that when a large number of tokens are sold; the price might decline as greater supply is available to the market.
Furthermore, this can lead to economic inequality, as the whales can benefit from market fluctuations. Additionally, it can be difficult for smaller investors to compete with the whales and can decrease overall investor confidence in the market.
However, although whales tend to offload their bags slightly before short-term tops occur, historically, they have been known to accumulate into dips which could be good for price in the long term.
At press time, Shiba Inu was trading at $0.0000125, up 0.85% in the past 24 hours. Dogecoin was exchanging hands at $0.0816 after a 0.66% increase.