Philadelphia Fed Study Shows Bitcoin Traders React Faster to Whale Alerts Than Ethereum Users

A working paper from the Federal Reserve Bank of Philadelphia examined how public notifications of large crypto transfers—known as whale alerts—affect trading behavior on Bitcoin (BTC), Ethereum (ETH) and Wrapped Bitcoin (WBTC). The study matched alert timestamps with on‑chain transfers through the end of 2025 and focused on whale transactions exceeding $50 million, excluding exchange and smart‑contract wallets.

Immediate reaction of non‑whale Bitcoin wallets

Non‑whale Bitcoin wallets showed the strongest same‑direction activity in the first 15 minutes after an alert. Small and medium wallets increased buy participation by 14.81 and 23.72 percentage points, respectively, after whale buys, while sell participation rose by 12.95 and 29.52 points after whale sells. Large Bitcoin wallets displayed modest changes (3.50‑point buy increase, 2.95‑point sell increase). The heightened activity tapered back to normal levels within an hour.

Ethereum’s comparatively muted response

Ethereum wallets did not exhibit a broad same‑direction shift. Participation remained relatively stable across wallet groups, with only the largest non‑whale cohort showing a modest increase after whale sells. Medium‑size ETH sellers reached a weak statistical significance threshold (10%).

Volatility effects

Whale alerts triggered a short‑term rise in realized Bitcoin volatility, which reversed by the 24‑hour mark. In contrast, Ethereum’s realized volatility tended to decline after alerts, suggesting large ETH transfers often occur during periods of falling volatility. Alerts involving Wrapped Bitcoin showed no statistically significant volatility impact.

Interpretation and market‑structure considerations

The authors attribute the divergent responses to differences in market structure. Ethereum transactions frequently flow through exchanges, smart contracts and layer‑2 solutions, aggregating many user actions into larger balances, whereas Bitcoin activity is more directly reflected in on‑chain transfers. This pattern persisted after Ethereum’s September 2022 transition to proof‑of‑stake, indicating that consensus design alone does not explain the gap.

While the study identifies clear patterns, it remains observational. Wallet‑size categories are proxies based on transaction volume, a single owner may control multiple addresses, and exchange activity was excluded from the analysis.