This on-chain analysis tutorial will include identifying whales, the origin of tokens, the identities of wallet addresses, as well as checking whether money is flowing into the project.
Note: The token in this analysis is chosen for convenience, not for any other reason.
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Identifying whales with Ethscan, BSCscan, or Nansen
You can go to CoinMarketCap/Coingecko, and explore different coins that are available on various chains. Check both Ethereum (Eth) and Binance Smart Chain (BSC).
Usually, using Nansen will be faster due to its clear interface, but on scan pages, I find more complete information and it’s also very easy to identify whales once you’re used to it. Nansen mostly supports Eth and BSC token projects. For layer 1 coins with their own chains such as Mina, SOL, etc. We have to check on the scan page of that coin itself.
On the scan page, select the holder section, where wallet addresses are tagged as belonging to the team, exchange, etc. Next, we will check where the token comes from for that wallet address to determine whether the whale is related to the project or not.
Origin of tokens
For wallet addresses that are not tagged, you can assume that they belong to a holder (someone who bought the token) or a team member (received the token from the smart contract wallet).
-> Click on the wallet address to see where the token was acquired from. For example, here I will choose the fourth wallet address [0x8b].
Section 1: the wallet address you choose, see the transactions filtered by specific tokens (here it’s Floki).
Section 2: Analytics will provide you with data such as token balance charts, the number of tokens transferred, etc.
Section 3: specific transactions, this is where we trace the origin of the token. For example, this wallet address received over 150B $Floki from the Deployer wallet.
Curious to see if the whale holds any other tokens? -> Go to https://app.depocket.com/ and enter the wallet address to see the PNL, token allocation of that wallet, etc.
Some whales may use intermediate wallet addresses, or receive tokens through an untagged wallet address, so you may have to trace 2-3 wallet addresses to find the origin of the token. The wallet address [0x8b] is an example of this.
Wallet addresses identity
Some wallet addresses will have a name tag on the scan page, but some do not. For those that do not have a name tag, you can enter the wallet address on the following pages: https://vivigle.com/; https://oxt.me/
The name tag will be displayed in the wallet tags section, as shown below.
Get notified when a wallet address has token transfers
Currently, both Nansen and Watcher are charging for this feature. However, you can go to https://app.depocket.com/whales to set up an alert and receive notifications when the wallets in the list start transferring tokens. If the token you need is not available on this page, you can contact the project admin to have it added.
Comparing the money flow going into a project
Some factors that I usually use to estimate whether money is flowing into a project are:
Check on Nansen
The trend of tokens on CEX, DEX, staking pool, Smart money wallets. If the wallets on CEX, DEX show a decreasing trend, then tokens are being withdrawn from the exchange, which is a good signal.
Conversely, if the wallets on staking pools and smart money show an increasing trend, it is a good signal because tokens are being staked or collected.
Additionally, you can also check the chart balance of smart money wallets (wallet addresses that often trade at a profit) to see if they are accumulating or distributing tokens.
Check recent transactions. For example, with $Floki, Wintermute Trading is currently receiving tokens from the marketing team wallet and transferring them to the gate and KuCoin exchanges.
Check on Watcher Pro
Watcher Pro is currently free, but it supports a limited number of tokens, and the majority of commonly used tokens are available on the platform. For example, with LiDo:
- The number of active entities and new entities (meaning old/new wallet addresses that hold LiDo). If the number increases, it is a good signal that LiDo is experiencing FOMO, but if both columns decrease, it indicates that wallets are selling.
- In addition, for platforms that focus on providing staking services, you can check the TVL (total value locked) to see if it is increasing. An increase in TVL is a good sign that money is flowing into the project.
Some other factors to check for the flow of money into a project
Identifying projects with market makers
If you use Nansen, you can easily see the names of famous trading teams in the project’s profile section. However, if you don’t have Nansen, you can copy the wallet addresses of top holders and paste them into websites under section B.
Here are the names of some reputable funds and market makers: Jump Trading, Genesis, Alameda Research (dead), Framework, Wintermute. Reputable large funds: Coinbase Ventures, Binance Labs, Andreessen Horowitz -a16z, Alameda Research, AU21 Capital, NGC Ventures, Jump Crypto, Digital Currency Group, Paradigm, Multicoin, Pantera, Framework Ventures, Draper VC, Polychain.
Check liquidity on exchanges
Projects with good liquidity are often aggregated, with stable trading volumes, and relatively stable trading volume compared to market cap (this varies based on the different lowcap, midcap, largecap projects).
When trading meme coins, I also check liquidity to identify fomo situations and profit-taking opportunities. For example, when CZ replied with the token name of Twoge, the trading volume and price were increasing, but the volume was not yet at $500K per day. I noticed this was an opportunity to buy (with the reason being fomo, in this case CZ’s reply); and I sold without hesitation when liquidity increased to $3M and CZ deleted the reply. When CZ deletes the reply, there’s no longer any fomo, and you shouldn’t hold anymore.
Check Twitter to see if the project is being shilled a lot: Simply search for “$project name”, for example “$FLOKI”, if there are many posts and KOLs sharing the news, the project is experiencing fomo and vice versa.
Other notes when checking the flow of money
- Compare the number of tokens held by a particular person: If the number of tokens they hold is worth more than 5% of the current daily volume, their selling action could significantly impact the price.
- Some whales may divide their holdings into many wallet addresses to hold, which can cause confusion. In this case, you need to create a watchlist of whale groups (https://app.depocket.com/watchlist), related addresses to track (see below).
- Lastly, compare the price that whales bought during the private sale with the current price on the exchange. If it increases multiple times, the whales are likely to sell. I usually check fundraising information for projects here: https://cryptorank.io/
