Ethereum is still a relative newcomer to the trading world, but it has nonetheless succeeded in drawing a lot of attention from investors, who are adding ETH coins to their portfolios in increasing numbers as a result of its ability to maintain their value over long periods of time. There are still many who feel like they wouldn’t fare well in this environment as a result of the complex technology that goes into supporting the transactions, but you definitely don’t need a degree in computer science to invest in Ethereum.
However, you must definitely do some research before getting started since being familiar with the basic concepts is very important and ensures you won’t make rash decisions. Learning how to buy Ethereum can be a lengthy process, as investors need to identify the most reliable and trustworthy platforms, create accounts, and set up their wallets. Since Ethereum is one of the most important cryptocurrencies in the world, with the second-largest market capitalization level, it is a highly-coveted prize by hackers, meaning that traders must also take the necessary safety precautions to protect their ETH.
Shrimps and Crabs
You have probably heard about the crypto whales, investors with large amounts of capital whose transactions have the potential to change prices. But the whales are not the only creatures inhabiting the crypto sea. The digital coin trading environment has been very creative with the way it categorizes investors, with several terms derived from marine life species used to represent the amount of money an investor has invested into their crypto holdings. Shrimps are the first tier in this hierarchy. They hold very small amounts of crypto and are typically new to the trading environment. However, the shrimps are also the largest majority of crypto traders at the grassroots level in a sense.
While their investments are relatively modest, the shrimps are crucial for the well-being of crypto markets as they help support the vitality and liquidity of the trading environment. Shrimps typically hold less than one coin. The crabs come in second place, having slightly more crypto than shrimps, with their holdings typically falling anywhere between one and ten coins. The crabs are more experienced, as a general rule, and some of them may be shrimps that increase their holdings with the help of strategic investments. However, they are still small-scale investors and, together with the shrimps, make up the largest number of Bitcoin wallets in the community.
Octopus and Fish
Octopus investors are the next step. This group owns between ten and fifty cyber coins, so although the name may imply that they’re also relatively small investors, that is not the case. As such, depending on the crypto, the smallest amount one requires to be considered an octopus is at least a couple tens of thousands of dollars if not hundreds. Fish wallets have fifty to one hundred coins. This group of investors is also sometimes referred to as minnows. Although they own much more than the shrimps and crabs, the fish and octopus investors tend to be at the mercy of more potent traders whose transactions move the market prices up or down, depending on the case.
The actions of the fish and octopus investors are therefore much less likely to have any kind of impact on the larger marketplace. In fact, their contributions typically remain negligible, but this tends to change when they begin acquiring more coins.
Dolphins and Sharks
As you move up the investor-owning ranking, the animals become larger as well. The next step after the fish is the dolphin, an investor who owns between 100 and 500 coins, followed by the Sharks, whose holdings can reach 1,000 tokens. This category tends to include individuals who got into cryptocurrencies very early on, sometimes right after their launch, as well as institutional and retail investors who have the means to invest significantly more than the average individual. However, in spite of the considerable amounts of crypto they own, these investors don’t have much of an impact on the market as well.
While their influence is likely to be a little more noticeable compared to that of the previous group, it is still far below that of their peers, who are much larger owners. According to the latest research, the number of sharks has gradually increased over time, while that of whales has started to go down.
Whales and Humpbacks
The whales are the demographic you’ve probably heard about most, which is interesting considering that they are among the wealthiest crypto investors. The reason for their popularity is that they are the ones who end up in the news most often as a result of their actions impacting the marketplace and changing prices. Most of the smaller investors keep an eye out for whale transactions, as they are unexpected and can cause serious fluctuations. Even if the effects are only temporary, that is typically more than enough to cause some serious damage for a marketplace as fast-paced and changeable as that of cryptocurrencies.
As a rule, the whales typically own 1,000 to 5,000 coins. They are either institutions or people who became interested in crypto trading very early on, and their actions always leave a mark on the trading environment. Humpbacks are even larger, although less known, and constitute the demographic with more than 5,000. This is normal since the number of investors that would own this amount would naturally be relatively small. The humpbacks are hugely influential and hugely powerful, and they are typically interested in crypto on a much larger scale. Therefore, they are more likely to be interested in the impact of digital assets and holdings on the world economy.
Large-scale investors also have the ability to invest in several types of crypto projects, such as blockchain initiatives.
To sum up, there are many different types of crypto investors, and having a good idea of how they’re most likely to behave in the environment will provide you with essential guidelines for how to act in the ecosystem.
