Question #203 ·
Why does large Bitcoin selling by whales create price volatility?
- Whale selling signals stronger fundamentals that typically boost investor confidence.
- Large whale sales flood markets, increasing supply, causing price swings. Right answer
- Whale sales stabilize prices by balancing demand and supply volatility.
- Whale selling reduces Bitcoin supply, causing price increases over time.
Why is this the correct answer?
This is correct because when whales, or large holders, sell large volumes of Bitcoin, the sudden supply influx can overwhelm buying demand, leading to sharp price drops and heightened volatility as traders react emotionally.