Bitcoin, the most dominant cryptocurrency. The cryptocurrency with the biggest market cap and now it seems, a cryptocurrency that has become monopolised through the Bitcoin ownership of the top 1%.
According to recent findings, just 1% of all Bitcoin wallet addresses hold 55% of the worlds Bitcoin. Similarly, according to The Guardian, in 2017 the top 1% wealthiest people in the world now own more than half of the worlds wealth. Can you spot any similarities here? According to The Guardian:
âThe worldâs richest people have seen their share of the globeâs total wealth increase from 42.5% at the height of the 2008 financial crisis to 50.1% in 2017, or $140tn (Â£106tn), according to Credit Suisseâs global wealth report published on Tuesday. At the other end of the spectrum, the worldâs 3.5 billion poorest adults each have assets of less than $10,000 (Â£7,600). Collectively these people, who account for 70% of the worldâs working age population, account for just 2.7% of global wealth.â
Note that the quoted figures were accurate as of the 14th of November 2017, since then these figures may have changed, you get the picture though.
Bitcoin Whales are to blame here. The top 1% of wallets seem to be controlled by whales who are holding onto incredible amounts of Bitcoin, in fact it works out as around $100 billion worth of Bitcoin. According to the findings as reported by The Next Web, up to one third of all the Bitcoin held by these whales has never been moved out of their wallets after the initial transaction, meaning that these Bitcoins have literally sat and stagnated, never having been used for any other purpose than holding.
Image sourced from thenextweb.com
Why is this significant?
This is something we turn to time and time again. How can a product be decentralised if the majority of the product is owned by just 1% of its users. These whales have an incredible amount of people should they decide to dump or sell their coins, a power that could have dreadful consequences.
Of course, this 1% arenât holding Bitcoin maliciously, as a matter of fact, thereâs a chance that some of this Bitcoin may have been locked up as it has been forgotten about, or private keys have been lost. Most likely though, this 1% are holding out for a big return on their investment. This explains why up to a third of these Bitcoins havenât ever moved. If the whales arenât spending Bitcoin, they must be holding out for something bigger.
Or, maybe we have located a bunch of doomsday preppers that have found a solution in Bitcoinâ¦ just incase.
The Next Web