Question #264 ·
What impact do large whale transactions have on Bitcoin price movements?
- They cause price swings by altering supply demand Right answer
- They validate Bitcoin blocks when large transactions occur
- They influence Bitcoin protocol code updates miner consensus
Why is this the correct answer?
Large whale transactions shift significant amounts of Bitcoin in or out of exchanges. Big buys reduce market supply and can push prices up. Large sells increase supply and often drive prices down. These large orders can also trigger automated trading algorithms, amplifying price swings.