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Individual whales control 33% of circulating Ether supply

Benson Toti

One third of the total supply of Ether (ETH) currently in circulation is held by less than 400 individuals, a new research has found.

Blockchain analysis company Chainalysis yesterday published a study assessing the impact of “Ether whales” on the market. According to the company’s definition, whales are “the top 500 holders of cryptocurrency, excluding services, who store their holdings off exchanges.”

Chainalysis’ research found that, as of May 1, 124 of the top 500 Ether holders were services, while the remaining 376 were individual whales. According to the study, these 376 whales control 33% of the circulating supply in 2019. While significant, their share is actually down from 2016, when individual whales controlled 47% of the supply.

The study also found that these whales account for a relatively small percentage – between 5% and 18% – of economic transaction volume. This is because around 60% of the wales “are holding their assets or not regularly trading with exchanges”, Chainalysis notes.

The researchers also studied the impact of whales on the price of Ether. Using a vector autoregression (VAR) model, the firm found that whales sending funds to exchanges does not have a direct impact on the Ether price, but contributes to intraday price volatility. In contrast, funds that whales receive from exchanges do not impact Ether prices, nor intraday volatility.

Using the same method, the company also discovered that the Ether price follows the price of its larger crypto rival, Bitcoin (BTC).

“On average, a 1% increase in Bitcoin prices yesterday leads to a 1.1% increase in Ether prices today.  We find no statistically significant impact of Bitcoin prices on Ether intraday volatility,” Chainalysis wrote.

In today’s trading, the Ether price stood at $263.68, as of 16:23 BST. The digital coin has gained just over 13% in the past 24 hours, according to data from cryptocurrency tracker Coinmarketcap. The coin’s total market capitalisation currently stands at nearly $28 billion.

Featured image: Sergey Nivens / Shutterstock.com

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