Bitcoin Wealth is Almost 50 Times More Concentrated than Global Wealth According to PARSIQ Research

default
ADVERTISEMENTSBlockchain Education
Evident
Tymlez

Blockchain monitoring and intelligence platform, PARSIQ, has opened up the results of its study on the distribution of cryptocurrency wealth across the top five cryptocurrencies, showing clearly that Bitcoin wealth is concentrated in a relatively small number of wallet addresses, and this number hasn’t changed significantly in years.

Andre Kalinowski, Co-founder at PARSIQ, said:

donate to Blockchain News

“Right now, just 6,457 individual wallet addresses hold fifty percent of the entire cryptocurrency wealth of all the top five cryptocurrencies. Excluding Bitcoin, that number drops to 1,805. The individuals and organiSations which control these addresses hold a huge amount of influence, and their power goes mostly unchecked because their activities go largely unchecked.

Cryptocurrencies were created with the desire to create a more egalitarian society away from government manipulation and centralised control. However, the latest research from PARSIQ has found that cryptocurrency wealth is controlled by a small number of early adopter and exchange-owned “whale wallets.”

parsiqAcross the top five cryptocurrencies by market capitalisation, the most concentrated is Ripple, with half of XRP controlled by only 14 wallet addresses, just 0.001% of the total funded wallet addresses3. However, Ethereum isn’t far behind with 346 wallets consisting of 0.003% of wallet addresses1.

“HODLing” leads to increased concentration of wealth

The minimum number of Bitcoins required to enter the elite of the top 50% of Bitcoin wallet addresses is 347 BTC, or around $3.8m equivalent. On average, these wallet addresses have been in existence for just over two years, so much of the accumulated wealth pre-dates the surge of interest in late 2017.

walletsparsiq eIn its first few years, Bitcoin wealth became gradually more distributed, but this accumulation has not changed significantly in two years (see chart below), and to some extent has gone into reverse. Ethereum and Litecoin have also been relatively stable, although far fewer wallets control half the wealth with these cryptocurrencies – 346 and 180 wallet addresses respectively.

Bitcoin Cash is the exception to a stable two years. It has seen a significant concentration of wealth since the hard fork that created it, as large holders of BCH cashed in on their holdings.

The real story is that although mass media interest in 2017-2018 has brought significant interest, very little has changed under the surface. The whales are still holding cryptocurrencies long-term and still have the ability to move the markets.

“The fact is, the transparency that’s part of the DNA of cryptocurrencies has been clouded by the size and complexity involved in analysing these cryptocurrencies. It’s time to open up the blockchain to everyone, to encourage fairer wealth distribution, or at least ensure the whales are more accountable through better monitoring.”

  1. Bitcoin wallet addresses holding at least $1, currently numbering 20,314,235 wallets. Ethereum wallet addresses with at least $1 number 10,129,112
  2. Credit Suisse Wealth Report 2017 found 1% of the world’s population own 50.1% of the global wealth (or approximately $140tn) https://www.credit-suisse.com/about-us/en/reports-research/global-wealth-report.html
  3. Wallets holding at least 20 XRP (approximately $6), currently numbering 1,592,456

PARSIQ is a next-generation blockchain monitoring and intelligence platform. PARSIQ’s solution listens to all blockchain activity and builds a fully indexed representation of what happens in a particular blockchain and when. It goes beyond the current solutions, with new innovations such as mempool monitoring and ParsiQL, a query language to allow complex logic conditions to be created that reacts in real-time to the events or specific transactions on the blockchain. The technology protects against unauthorized blockchain events, it’s market intelligence capability gives new insights into blockchain trading activities and with forensics, it can deep dive into past criminal activity that has taken place on the blockchain.

About Richard Kastelein

In his 20s, he sailed around the world on small yachts and wrote a series of travel articles called, ' The Hitchhiker's Guide to the Seas' travelling by hitching rides on yachts (1989) in major travel and yachting publications. He currently lives in Groningen, the Netherlands where he has set down his anchor to raise a family and write.

Founder and publisher of industry publication Blockchain News (EST 2015) and director of education company Blockchain Partners (Oracle Partner) – Vancouver native Richard Kastelein is an award-winning publisher, innovation executive and entrepreneur. He has written over 2500 articles on Blockchain technology and startups at Blockchain News and has also published in Harvard Business Review, Venturebeat, Wired, The Guardian and a number of other publications.

Kastelein has an Honorary Ph.D. and is Chair Professor of Blockchain at China's first blockchain University in Nanchang at the Jiangxi Ahead Institute software and Technology. He has over a half a decade experience judging and rewarding some 1000+ innovation projects as an EU expert for the EuropeanCommission's SME Instrument programme as a startup assessor and as a startup judge for the UK government's Innovate UK division. Kastelein has spoken (keynotes & panels) on Blockchain technology at over 50 events in 30+ cities.

Visit Website
View All Articles

Also published on Medium.

advertisementsBlockchain Education
Blockchain Expo North America 2020

blocktv

LIVE!

BLOCKTV is the premier televised news source for the blockchain and cryptocurrency community. They are a live, 24/7, TV news channel dedicated to premium reporting on the blockchain and cryptocurrency markets.