The Dogecoin bullish wave is over or a pullback after two months of unparalleled growth. In any case, the last fall of Dogecoin reminded us how fragile the crypto doge is. It took Elon Musk’s circus for her to lose 20 cents. There is not just that ! The fear that the major Dogecoin investor would sell these tokens also aided the bearish momentum.
The Doge was believed to be the asset of small investors but apparently the crypto is owned by several large investors . First, the famous address DH5yaieqoZN36fDVciNyRueRGvGLR3mr7L whose identity everyone is trying to find out. This address has a Dogecoin equivalent of more than 22 billion to its credit. In addition, according to business insider, the top 100 Dogecoin accounts hold 67% of the Doge in circulation.
An Address With 28% Of The Doge In Circulation
According to Business Insider, the address DH5yaieqoZN36fDVciNyRueRGvGLR3mr7L holds nearly 36.7 billion Dogecoin. The address has been accumulating crypto tokens from the meme since February 5, 2019 when the Doge was trading for $ 0.0018.
Taking into account the peak of 70 cents , the holder of this address could realize a capital gain of $ 0.6982 on each of his first tokens. Since the Doge has already grown by over 10,000% this year, no need to imagine the enormity of the profit this address has made.
Robinhood In The Dock
Rumors lead to Robinhood being the potential owner of this address. At least that’s the opinion of Tom Robinson, the chief scientist and co-founder of Elliptic, told Bloomberg: “ She most certainly belongs to Robinhood ”. She to refer to the address. Tom added:
The time of its creation, and the creation of the addresses from which it received funds, correspond to when Robinhood supported Dogecoin.
The CEO of Robinhood denied this information regarding the possession of the address:
All the coins we hold are intended to give our clients access to their assets. We don’t have significant positions in the parts that we own or anything like that.
The Risks With This Whale
The main risk with the whale is that it can play on its number of tokens to influence the price of Dogecoin . A little microeconomics to understand the risks with the whale. Imagine a market with an infinitely large number of buyers and a small number of sellers. You imagine there is a seller who owns almost 30% of the product. So, the product price configuration would be:
P = (p1 + p2 + p3 + …… + p30 + …… .pn) / N
with p1 …… pn => price of other sellers
p30 => seller’s price which has 30%
N: number of sellers in the market
Since p30 is that of the seller whose market share is 30%, its change in the price structure can affect the market price and may cause other sellers to match its price. The opposite can happen unless the other sellers formed cartels.
So back to Dogecoin, we can well deduce that the address of the whale has a fairly large decision-making power over the course of the Doge. In addition, the other addresses cannot be combined since they are all anonymous. Moreover, the mere fact that traders were able to detect this piece of information, the price of the Doge fell on the stock market without the address necessarily having sold its Doge.
– Husan Ravshanov, American University of Central Asia