Major Players and Cryptocurrency Prices: When Is It Normal Trading and When Is It Market Manipulation?

News of a large amount of bitcoin being moved to an exchange, or of a sharp rise in transaction volume, can easily raise suspicions that someone is about to influence the price. Similar speculation also surrounds the activity of large holders of bitcoin, XRP or Cardano. However, a transfer on the blockchain alone does not tell us whether a sale actually took place, who was on the other side of the trade, or why the owner decided to move the funds. [1]

Big players can undoubtedly influence cryptocurrency prices. A large purchase or sale, however, does not automatically mean manipulation. Manipulation involves, for example, creating a false impression of demand, artificially inflating trading volume or spreading misleading information. To assess what is happening on the market correctly, we must above all distinguish between what we actually know and what we merely assume.

Who is behind the term whale?

In the cryptocurrency market, whales are entities that hold or move large amounts of cryptocurrency. There is, however, no single threshold at which an investor becomes a whale. For example, when introducing its metrics for bitcoin entities, the analytics company Glassnode worked with a threshold of at least 1,000 BTC, while excluding known exchanges from this group. When interpreting such statistics, therefore, what matters is not only the number itself but also the methodology used. [2]

It is also important to distinguish between a blockchain address and its actual owner. One investor may split their funds across dozens of different addresses. Conversely, a single exchange address may hold the cryptocurrencies of thousands of clients. A large balance at a particular address therefore does not mean that all the funds belong to one person who could decide to sell them all at once. [2]

Likewise, holding cryptocurrencies must not be confused with actively trading them. A large balance shows that an entity has a substantial amount of funds at its disposal, but says nothing about whether it is currently offering them on the market. Moreover, several large transfers need not represent the activity of several independent investors.

Before we start assessing the influence of whales on the price, we should therefore first clarify who the statistic we are following actually covers.

Why can a large trade move the price?

How strongly a purchase or sale affects the price of a cryptocurrency depends above all on its size and the available liquidity.

If, for example, a large sale exhausts the nearest buy orders, the next part of the order may be executed at lower prices. With a large purchase, the mechanism works the other way round. The trader gradually takes up the available sell orders and, if there are not enough of them, buys at ever higher prices.

In a market with low liquidity, even an order that would have a much smaller impact in a more liquid market can therefore cause a significant price movement. [3]

On some decentralised exchanges, trading works differently. Instead of a classic order book, users swap cryptocurrencies through so-called liquidity pools, which are managed by smart contracts.

Here too, what matters is the size of the trade relative to the available liquidity. The same swap may therefore cause a more pronounced price movement in a smaller pool than in a pool with a sufficient amount of funds. Not every price swing, then, arises from the gradual depletion of orders in an exchange order book. [4, 5]

Imagine, for example, an investor who needs to sell part of their cryptocurrencies to raise money for everyday expenses. If they accept the currently available buy orders, they may push the price down. The fall itself, however, says nothing about their intention.

The sale may have had a considerable impact on the market even though the investor did not deceive anyone or try to create an impression of different trading activity.

Moreover, large traders often have no interest in causing a sharp price movement. By doing so, they could worsen the very conditions under which they buy or sell.

That is why they sometimes split their orders into smaller parts and execute them gradually. One example is the TWAP strategy, in which a larger trade is executed in smaller parts according to a predetermined schedule. The aim is to limit the price impact of a large order. It is not a guarantee of a specific final price, but it illustrates that a large position need not mean a single sudden intervention in the market. [6]

Some professional participants, on the other hand, provide liquidity. So-called market makers continuously post buy and sell orders, which make it easier for other traders to complete trades.

Their role is fundamentally different from creating fictitious trading activity. However, the label market maker alone is no guarantee of honest conduct by a particular company. It always depends on how it actually trades. [4]

A sharp price swing need not have a single originator

A significant price movement can trigger a chain reaction among other traders. Once a cryptocurrency reaches a certain price level, pre-set orders may be activated, for example orders to sell or to limit losses.

Whether they are actually executed depends on the type of order and the current market situation. For example, a stop-limit order creates a limit order once the specified price is reached. That does not yet mean the trade will actually take place. [6]

Another factor may be the liquidation of positions held by traders using leverage. If the value of the collateral for their position no longer meets the trading platform’s requirements, the trade may be forcibly closed.

Such liquidations can further amplify a price movement that is already under way. With derivatives trades, however, it cannot automatically be assumed that every position closure means the sale of a corresponding amount of actual cryptocurrency on the spot market. [7]

It also depends on which price the platform uses to assess a possible liquidation. For the derivatives products described, for example, the Kraken exchange uses a reference price known as the mark price and monitors the collateral status of the position.

A short-term swing in the last traded price on a single exchange therefore does not in itself prove that all related liquidations must have been triggered. [7]

If the price of a cryptocurrency falls sharply and then immediately returns to its original level, this may be a combination of several factors: large sales, a change in liquidity or the forced closing of positions.

The shape of the price chart alone, however, does not reveal whether someone deliberately caused such a movement. To claim that it was an intentional “stop-loss hunt”, we would need further evidence of the conduct of specific market participants.

Fake orders can create the impression of strong interest

An exchange order book records buy and sell orders that have not yet been executed. A large buy order may therefore look at first glance like proof of strong demand. A large sell order, in turn, may create the impression that a significant obstacle stands in the way of further price growth.

Orders, however, are not fixed. Traders can modify or cancel them at any time. A single look at the order book therefore does not mean that the displayed amount of cryptocurrency will actually be traded. [6]

One well-known manipulative practice is spoofing. It involves placing orders that the trader does not actually intend to have executed and plans to cancel before execution.

In this way, they can create a misleading impression of supply or demand and influence the decisions of other market participants.

The key element, however, is precisely the intention to deceive. Cancelling an order alone does not prove spoofing. An honest trader may also withdraw their order, for example because market conditions have changed. [8]

When assessing suspicious activity, it is therefore important to follow the entire course of placing and cancelling orders, their connection with other trades and any links between individual accounts.

For example, the Coinbase exchange’s rules classify both spoofing and the artificial creation of trading volume as manipulative conduct. Publicly available market data, however, do not normally show which particular trader placed or cancelled an order. An outside observer may therefore lack sufficient information to identify who is behind the suspicious conduct. [9]

Artificial volume can feign investor interest

Another well-known practice is wash trading, which creates the appearance of trading activity without any corresponding real change in economic interest in the asset concerned.

This may involve, for example, coordinated trades between accounts controlled by the same entity. From the outside, it then looks as if several independent investors were trading the token.

The result may be a high reported trading volume, which in reality does not mean that a corresponding amount of new capital has entered the market. [10]

This is not merely a theoretical possibility. The US Department of Justice described the case of CLS Global, a company that pleaded guilty to criminal offences related to manipulation and fraud.

In April 2025, a court imposed sanctions on it for fraudulently generating trading volume. The company used multiple cryptocurrency wallets and algorithmic trading to make its transactions look like natural market activity around a specific token. [10]

In June 2025, sentences were also announced in the case of the company Gotbit and its founder. According to the published findings, the firm created artificial trading volumes for its clients’ cryptocurrency projects. [11]

Both cases show that such manipulative practices really do exist. However, they do not support the conclusion that every significant rise in bitcoin comes about in the same way or that every entity providing liquidity to the market is suspicious.

An organised price rise can serve to sell one’s own tokens

Another manipulative strategy is the so-called pump and dump.

Its organisers first stir up interest in a cryptocurrency they already hold themselves. Through coordinated promotion, purchases or false information, they attract new investors. As soon as demand drives the price up, they start selling their tokens.

The US Commodity Futures Trading Commission (CFTC) warns of this mechanism particularly in connection with less traded tokens and groups that coordinate their activity via social networks and messaging apps. [12]

Imagine, for example, a group that starts intensively promoting a token with an initial price of €0.20. Its value then rises to €0.60.

The group may present the 200% rise to newcomers as proof of exceptional investment potential. At that very moment, however, the organiser may be selling tokens bought before the promotion began.

Investors who arrive later thus buy at considerably higher prices and, when they want to get their money back, may not find enough further buyers.

Warning signs may include a pre-arranged time for joint buying, pressure to decide immediately or promises that participants will manage to sell safely before everyone else.

Even membership of such a group, then, does not guarantee an advantage. The organisers may have entirely different information and trading conditions from the people they are urging to buy.

At the same time, a rapid price rise alone does not prove a pump and dump. Reaching such a conclusion also requires examining the way the token was promoted, the links between the participants and their actual trades. [12]

What do movements on the blockchain really show?

The blockchain makes it possible to follow individual cryptocurrency transfers. Without further information, however, their real economic significance may not be clear.

If, for example, a large amount of bitcoin arrives at a known exchange address, it may be preparation for trading, hedging of another position or a routine operational transaction.

A transfer between two addresses may even be merely an internal movement of funds within a single company or service.

Transaction volume on the blockchain therefore cannot automatically be equated with the volume of purchases and sales actually executed. [13]

Nor is the attribution of individual addresses to specific entities always definitive. Glassnode points out that new information about exchange wallets may lead to a retrospective reassessment of previously recorded cryptocurrency inflows and outflows.

A transfer that originally looked like a client withdrawal may thus later turn out to be merely an internal transaction.

When assessing unusual movements, it is therefore important to verify not only the transaction itself but also the reliability of address labels and any later corrections to the data. [13]

The following overview shows the difference between what we observe and what actually follows from the observation.

Large inflow to an exchange

What it may mean: Preparation for trading or another operation
What it does not yet prove: That a sale has already taken place

Higher transfer volume

What it may mean: More funds being moved
What it does not yet prove: An equal rise in real demand

Cancelled large order

What it may mean: A change in supply or suspicious conduct
What it does not yet prove: An intention to deceive others

Price drop and quick recovery

What it may mean: Temporary imbalance or a coincidence of orders
What it does not yet prove: The movement being steered by a single player

We should be particularly cautious about claims that a certain whale has just bought.

An increase in the balance at its address may merely represent a transfer of funds from another address it controls itself. Conversely, a position held through a centralised exchange may not be visible on the public blockchain at all.

Moreover, an outside observer usually does not know the related hedging or other parts of the entity’s investment strategy.

Trying to imitate a whale’s move therefore need not mean that we are actually copying its trading decisions. [2, 13]

What did research into large ether holders show?

An interesting insight into the behaviour of large investors is offered by a study by Alan Chernoff and Julapa Jagtiani, published as a working paper of the Philadelphia Fed.

The authors analysed data on the cryptocurrency ether (ETH) for the period from 2018 to 2023. Across the whole sample studied, they found that large holders typically increased their balances before ETH price rises. Smaller holders, by contrast, tended to reduce their positions. [14]

This finding, however, has important limitations.

The study works with aggregated groups of wallets, not with the complete trading strategies of specific identified investors. Moreover, the authors explicitly point out that the relationships found do not in themselves imply direct manipulation.

Their analysis also showed that larger price swings were linked more to the activity of smaller holders than to the movements of whales. [14]

Furthermore, for the largest group of holders, the relationship between changes in balances and subsequent returns did not prove statistically significant in the part of the sample after Ethereum’s switch to the Proof of Stake mechanism.

The results therefore cannot be regarded as a universal rule applicable to all cryptocurrencies and market periods.

Above all, the study shows that different groups of investors may behave differently. It does not, however, provide a reliable guide to predicting future prices on the basis of whale movements. [14]

How should estimates of suspicious trading be understood?

In its analysis published in 2025, the analytics company Chainalysis focused on possible cases of wash trading on the Ethereum, BNB Smart Chain and Base networks during 2024.

The combined results of the two methods used reached an upper estimate of approximately USD 2.57 billion in potentially suspicious trading volume. The authors point out that the results of the two methods may partly overlap. [15]

This figure, however, cannot be interpreted as a proven loss to investors or as the total volume of manipulation on the cryptocurrency market.

The analysis covered only selected blockchain networks, the transactions monitored and specific rules for detecting suspicious patterns.

Chainalysis itself also stresses the difference between identifying suspicious behaviour and proving intentional manipulation. Proving it conclusively may also require information that cannot be obtained from the blockchain alone. [15]

When reading such statistics, we should therefore always ask what exactly they measure, what period they cover and which parts of the market they leave out.

Suspicion, an expert estimate and conduct confirmed by a court carry entirely different evidential weight.

Likewise, if several media outlets publish the same chart or take over an identical analysis, this does not automatically amount to several independent confirmations of the conclusion.

How should the next whale report be assessed?

Before we react to a report of unusual activity by large cryptocurrency holders, it is worth asking a few basic questions:

• – Are we looking at a trade that has actually been executed, an order that has been placed, or merely a transfer between blockchain addresses?
• – Do we know where the data come from, what period they cover and on what basis individual wallets were attributed to specific entities?
• – Does the conclusion presented match the available data, or is the author inferring an unverified intention of the investor from the transfer alone?
• – Is there another possible explanation, such as the management of funds in custody, a change in liquidity or the liquidation of trading positions?
• – Is it merely an analytical hypothesis, or manipulative conduct backed by concrete evidence?

If we nevertheless decide to trade on the basis of such a report, we should also understand the terms of the trade itself.

A market order, for example, may be executed at several different prices. A limit order, on the other hand, allows us to set an acceptable price but does not guarantee that the order will actually be executed.

Choosing the right type of order does not settle the question of whether the original report is true, but it can significantly affect the price at which we enter or exit a position. [3, 6]

Not every uncertainty needs to be explained by a story about an all-powerful player controlling the entire market.

Sometimes we only have enough information to state that a large amount of cryptocurrency has been moved and that the price has changed at the same time.

Admitting that we do not know who really caused the movement or why is more accurate than claiming without evidence that a pre-planned manipulation lies behind it all.

Conclusion: a big player does not automatically mean manipulation

Large participants in the cryptocurrency market can have a significant influence on short-term price developments, especially in an environment with limited liquidity. Their activity, however, may also be the result of ordinary asset management or part of trading that, on the contrary, makes buying and selling easier for other investors.

Manipulative practices such as fake orders, artificial inflation of trading volume or organised pump and dump schemes really do exist. This is also borne out by specific cases that have already been dealt with by the relevant authorities and courts.

However, neither a price chart nor a large transfer on the blockchain is enough on its own to prove manipulation.

We should therefore regard a report of whale activity primarily as a prompt to verify the wider context, not as a clear signal of future developments.

It is essential to distinguish between a transfer and an actual trade, between a visible balance and an overall investment strategy, and between mere suspicion and proven conduct.

It is precisely the ability to interpret the available data correctly that will help us understand the cryptocurrency market better and not be swayed by every report of an unusual move by large investors.

Sources and further reading

The numerical example is illustrative. Research data relate to the periods and samples stated in the text. Sources were verified on 22 October 2026.

[1] Kryptomagazín. Manipulují velcí hráči s cenami kryptoměn
[2] Glassnode. How Many Entities Hold Bitcoin
[3] Binance.US Support. Understanding price impact and slippage
[4] Binance Academy. Market Makers and Market Takers Explained
[5] Uniswap Labs. What is price impact
[6] Coinbase Help. Advanced trade order types
[7] Kraken Support. Liquidation FAQ
[8] CFTC. Mitsubishi Corporation RtM Japan order concerning spoofing
[9] Coinbase. Coinbase Markets Trading Rules
[10] U.S. Department of Justice. CLS Global sentenced for cryptocurrency wash trading
[11] U.S. Department of Justice. Gotbit and founder sentenced for market manipulation
[12] CFTC. Beware Virtual Currency Pump and Dump Schemes
[13] Glassnode. Bitcoin On Chain Exchange Metrics
[14] Alan Chernoff and Julapa Jagtiani. Beneath the Crypto Currents The Hidden Effect of Crypto Whales
[15] Chainalysis. Market Manipulation Suspected Wash Trading on Select Blockchains

This text serves informational and educational purposes only and does not constitute investment advice. Crypto assets are volatile, and you may lose the entire amount invested.