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Bitcoin’s wealth inequality in numbers

Photo of: Nathan VDH
by Nathan VDH

The value of Bitcoin does not prevent the acquisition of cryptocurrency. The value remains very concentrated, however. Thus, wallets hosting at least 1 BTC represent 95% of the total capitalization of Bitcoin.

With the rise in the price of Bitcoin, acquiring one of these assets now requires the holding of a certain amount of capital. According to Glassnode, this is the case of a minority share of the investors in Bitcoin.

The number of Bitcoin addresses holding one or more BTCs has been steadily increasing since 2009. This year, this figure even exceeds 800,000 wallets according to Glassnode’s technical director Rafael Shultze-Kraft.

These users, known as “wholecoiners”, account for 95% of Bitcoin’s total capitalization. In other words, the holders of less than 1 BTC represent only 5% of this capitalization. The distribution of wealth is in fact unequal.

800,000 addresses, which do not necessarily correspond to as many distinct individuals, weigh 95% of the value of Bitcoin. Tens of millions of users, on the other hand, share just 5% of this value.

This trend is not new, however. In September, the top 10,000 Bitcoin addresses weighed about 58% of the total wealth. For the top 10 addresses, it is even 5% of Bitcoin’s total marketcap (around $30 billion).

In value, the comparison can be even more meaningful. Bit Info Charts thus specifies that the wholecoiners addresses have a Bitcoin weight equivalent to 300 billion dollars. This figure is simply around $16 billion for those who do not own a whole coin.

Bitcoin is not, however, the major cryptocurrency characterized by the greatest inequality in the distribution of wealth. Quite the contrary. In the Ethereum universe, 10 addresses hold about 17% of the tokens in circulation. For the top 1000, it is 43%.

Ripple’s XRP is perhaps the most representative of these inequalities among the Altcoins according to Ledger Exposed figures. In September, the 100 best-endowed addresses, including those of the founders, accounted for 67% of XRP tokens.

Nevertheless, cryptocurrency continues to attract new users. And the launch of a crypto payment service by PayPal should further promote this democratization in terms of adoption.

On the Bitcoin side, as is often the case in periods of bull run, the blockchain is welcoming newcomers. On November 18, Glassnode observed the creation of 24,807 new Bitcoin addresses in the space of just one hour. But how many will eventually join the wholecoiners?