Bitcoin: 97% are held by 4% of addresses

A
man walks past an electric board showing exchange rates of
various cryptocurrencies including Bitcoin (top L) at a
cryptocurrencies exchange in Seoul
Thomson Reuters

In a wide-ranging note on cryptocurrencies and
blockchain, Credit Suisse explored the concentration of wealth
in Bitcoin

‘97% of all Bitcoins are held by 4% of addresses,’
according to the bank. 

 

Is Bitcoin just another toy for the 1%?

It’s a question analysts at Switzerland-based bank Credit Suisse
explored in a big note on cryptocurrencies and blockchain sent
out to clients on Thursday. 

“The concentration of wealth at a small group of addresses – be
it individuals or exchanges –means that a few key players in the
game can have a massive influence on the Bitcoin
market,” the bank said. 

Screen Shot 2018 01 11 at 10.35.32 AMCredit
Suisse

Those “hodlers,” as they’re referred to in the crypto world, are
holding onto their Bitcoin for dear life. As such, wealth in the
ecosystem has become very concentrated. 

97% of all Bitcoin are held by 4% of all Bitcoin addresses,
according to the bank. 

By way of comparison, the wealthiest 1% own just about half of
the world’s wealth, according to analysis by Credit Suisse in
November. 

The bank said the wealth concentration points to Bitcoin‘s
use-case as a store of value, akin to gold. 

“Significant proportions of Bitcoin and other cryptocurrencies
are apparently being held like precious assets, thereby severely
restricting the flow and availability of the digital currencies,”
bank said. 

2017 was a breakneck year for Bitcoin investors. The red-hot
cryptocurrency soared to an all-time high near $20,000 in
December. It ended the year up 1,300%. 

As for Bitcoin‘s market capitalization, it soared from $15.6
billion at the start of 2017 to an all-time high above $320
billion in December, according to data from CoinMarketCap.com.

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