Tencent Technology News January 23, the CEO of American software company Microstrategy Michael Sayeller (Michael Sayeller) is also a Bitcoin investor, holding more than 560 million US dollars worth of Bitcoin. He recently posted a video on his social media page, ending with mocking those who have not yet joined the cryptocurrency gold rush: "Enjoy poverty!"

The executive’s social media profile is also full of “famous quotes” that promote and promote Bitcoin. For example, one of the articles read: "Bitcoin is the dominant digital currency. The next 1 billion people will pay trillions of dollars to join. You may want to join first." Another article reads: "Bitcoin is not a Ponzi A scam is not a momentary craze, nor a bubble."

Thaler is one of the most notable "Bitcoin whales", a term that refers to individuals or institutions that have absorbed hundreds of millions of dollars in Bitcoin. Although Bitcoin may be touted by believers as the future of currency democratization, free from central bank and government constraints, in fact, this market is concentrated in the hands of a few hungry Bitcoin whales.

Industry data shows that among approximately 100 million known accounts, approximately 13% of all bitcoins (approximately US$80 billion out of US$600 billion) are in the hands of more than 100 individual accounts, and approximately 40% (worth approximately 240 billion) USD) is controlled by 2500 accounts. So far, Seiler has snapped up more than 18,000 bitcoins.

At the same time, Thaler’s company, MicroStrategy, was a little-known software vendor, but since last summer, the company has begun unrestricted acquisitions of this digital currency, many of which are close to $20,000 per coin. .

Ultra low trading volume

These moves by the "Bitcoin Whale" have raised concerns that retail investors, or "little fish in the pond", may be swallowed up by a few transactions, which may push up or down the price of Bitcoin. .

David Gerard, a cryptocurrency skeptic and author of the book "Attack Of The 50 Foot BlockChain," said: "The Bitcoin trading market is very thin, and the number of transactions available is small. Large companies can It is easy to manipulate prices, and there are all kinds of transaction fraud, which will never happen in a regulated market."

Around January 7, the price of Bitcoin soared to nearly 42,000 U.S. dollars, but after a painful week, it fell back to around 31,000 U.S. dollars, although this was still much higher than the previous high. Deutsche Bank said investors have noticed warning signs about bubbles. A survey for investors found that 90% of respondents believe that the stock market is in a bubble zone, and Bitcoin is their biggest concern.

Recently, a batch of institutional funds poured into the cryptocurrency field. Square, the payment company founded by Jack Dorsey, bought $50 million in bitcoins (currently worth about $150 million) in October last year. The British investment fund Ruffer said in December that it was acquiring $750 million worth of Bitcoin. Of course, this means that those who believe in digital currencies believe that their prices will only continue to rise due to scarce supply.

"God's Asset"

Peter Wall of Argo Block Chain, a cryptocurrency mining company, said: "We believe in Bitcoin, which is the reserve asset for today and tomorrow."

In a recent podcast, Seiler gave Bitcoin a religious meaning. He said: "If God intends to hold gold as a treasury reserve asset for 100 years, he will make 21 million gold coins, and then it is impossible to make more gold coins." Seiler did not respond to a reporter's request for comment.

However, the regulator was not convinced. The British Financial Market Conduct Authority (FCA) warned earlier this month that retail investors should be prepared to "get nothing."

Due to the special nature of Bitcoin transactions, they are recorded on a verifiable digital ledger. Anyone can see many of the largest transactions in real time and identify digital wallets.

The largest Bitcoin repository holds 1 million Bitcoins, which is equivalent to 30 billion U.S. dollars. It is said that this is the first Bitcoin wallet and it is believed to be the wallet used by its creator, Satoshi Nakamoto. It has been dormant for several years while people speculate that its creator has passed away.

The other accounts are accounts of crypto exchanges. For example, a wallet belonging to the Huboi exchange holds $4 billion worth of bitcoin. Some large “bitcoin whales” are even more bizarre. It is said that the Bulgarian government holds nearly $6 billion worth of bitcoins, which were seized in a raid. A mysterious account is worth about 1 billion U.S. dollars and is believed to be a cryptocurrency left over from the "Silk Road" dark web drug market.

The danger of Bitcoin whales

But Gerrard said that although some hedge funds and investment companies are also buying, the existence of these large companies should make small shareholders nervous. He said: "These big players have a lot of bitcoin and are very active in the market. Any one of them may cause an uproar in this market."

As prices are prone to volatility, stablecoins have gradually attracted more attention. These digital currencies are designed to enable large-scale transactions between exchanges or a large number of holders, because such transactions cannot be processed quickly by ordinary banks.

Tether is such a stable currency, and it is said that this cryptocurrency is linked to the price of the US dollar. As a source of liquidity between exchanges, it has a huge daily trading volume. The company said it will print hundreds of millions of dollars in cryptocurrency every day to meet the needs of exchanges. The whales here are bigger and more concentrated than Bitcoin.

Some cryptocurrency users are worried about these stablecoins. For example, Tether is under investigation by the New York Attorney General's Office. In a piece of private information disclosed in documents submitted to the court, Bitfinex executives associated with Tether stated that they fear that if their market goes offline, Bitcoin may “drop below $1,000”.

Tether and the Bitfinex exchange, both defendants, refused to accept any allegations of misconduct. Bitfinex's general counsel Stuart Hoegner (Stuart Hoegner) said: "We have fulfilled all obligations to the Attorney General's Office and have provided 2.5 million pages of materials."

Whales and institutional funds are always flowing into the market with a good trend, but if the situation reverses, it will be the big Bitcoin players who will drive the transaction. Gerrard said: "Bitcoin holders are buying Bitcoin with their company's money, and they are talking about Bitcoin frantically. This can be good for them as long as the price continues to rise." (Reviewed by Tencent Technology /Golden Deer)