Just 1,000 People Own 40 Percent Of The World's Bitcoins

By on December 17, 2017 in ArticlesHow Much Does

It's not really possible these days to not know about the growing problem in the world of income inequality, and the accompanying statistics involving the slim percentage of the population that holds a larger and larger portion of the world's wealth. As it turns out, a similar dynamic was developed within the world of Bitcoin, as a new Bloomberg story highlights the thousand investors who own 40 percent of the bitcoins in the world.

With Bitcoin continuing to grow and grow monetarily, it's easy to figure out why a concentration of investors are getting so much of the action – most people can no longer afford to play. But the situation reflects deeper ramifications for anybody who might be thinking of getting on the Bitcoin train, which is that these thousand power players can work together to influence the value of bitcoins. Here's how BlockTower Capital co-founder Ari Paul summed it up simply: "As in any asset class, large individual holders and large institutional holders can and do collude to manipulate price."

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Another reason so many bitcoins belong to so few is because the cryptocurrency mining system has rewarded early adopters, since at the beginning of the process it was much easier and less costly to mine bitcoins for yourself. One illustrative example would be Satoshi Nakamoto, the pseudonymous "father of Bitcoin," and who is believed to have roughly 980,000 bitcoins to his (fake) name, valued as of this writing at more than $15 billion, and which comes to about five percent of all the bitcoins now in existence. He first started using software to mine bitcoins back in 2009, when almost nobody was interested in the cryptocurrency, but a curious individual would now need tons of money to acquire even a fraction of what he was able to accumulate so easily.

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