Another $50 billion purchase has been made, here’s why whales are buying
Following another large purchase of 50 billion Shiba Inu tokens, it is important to break down why exactly Ethereum whales or simply large cryptocurrency market participants are constantly buying up to trillions of SHIB tokens worth millions of dollars.
The whales try to take control of the token
According to WhaleStats, Shiba Inu remains the largest USD-valued position among Ethereum whales with large wallets holding around $1.3 billion worth of SHIB. The desire of the whales to take control of the circulation of the asset on the market explains such dominance.
Usually, a high concentration of supply in the hands of whales is considered “bullish” by crypto enthusiasts, as they prefer accumulating assets over redistributing them. With a high percentage of the supply being held by retail traders and investors, the market usually sees more selling pressure than in the other case.
A massive discount
While taking control of the circulating supply, whales would not have actively purchased an asset at such a steep discount as we see on Shiba Inu. According to data from TradingView, SHIB has lost more than 70% of its value since the ATH, making the risk/reward ratio of a further rally attractive for investors.
Shiba has the “meme potential”
The meme’s potential term was brought up on the market after Dogecoin’s massive run in 2021, which usually means that the asset has the potential for a strong rally with no fundamental reasons behind it.
“Meme rallies” are usually powered by retail marketers and only last a few weeks at best. Although this type of rally brings hundreds of percent to investors and traders, they tend to fade quickly and typically lose up to 90% of their value.
