What is a dark pool in cryptocurrency
Dark pool
When you hear the word dark pool a lot of people uneasy about the way that investors are taking advantage of the market. but when we heard about them they piqued our interest you see the story that we used in the beginning of this video is exactly, what a dark pool is it's platform that is used to hide large transactions from the general public now this can be used to avoid slippage to avoid. causing prices to plummet to avoid the fear that comes from seeing a whale selling their coins or just to get an average price for a large number of crypto let's go over each of the benefits of these real quick before explaining exactly, how a dark pool actually works so number one.
Avoiding slippage
Slippage is the term for what happens when you put it in order to sell a Bitcoin for thirty five thousand dollars. but it actually sells for thirty four thousand dollars nine hundred eighty to make sure that it's sold immediately, you have to give it some give and this give is also called slippage. the more crypto you were buying or selling the more slippage you"ll have to be comfortable with number two is.
Avoid price volatility
So whenever you dump a bunch of crypto back into the market you can effectively change. the price of crypto due to how supply and demand works when you add more supply it"ll cause the demand to drop, and when the demand drops so will the price number three is to avoid the fear of a whale selling so blockchains and three is.
Fear of a whale selling
So blockchains are really cool technology. but most of them are open for anyone's eyes to look at this means any large wallet holder is constantly under the eye of professional traders, if they see a whale dumping their coins they may get scared and think. that the whales know something that they don't and then this will cause them to follow suit and then eventually crash the price. even more in short dark pool are a great way to hide trades some dark pools actually allow you to trade your hardware wallet as opposed to making a crypto transfer lastly number four.
Get an average price
Some dark pools traders to walk in and say i have 20,000 Bitcoins to sell and i want to guaranteed for all of them. what can you give me then the dark pool will a return price that they can afford and that will allow the seller to know exactly, how much they can actually their Bitcoins for instead of guessing how much they may be worth.
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Okay..In sha Allah next time i will try my best.