A new research report has shed light on the ownership landscape of Bitcoin (CRYPTO: BTC), revealing that a substantial majority of Bitcoin holders are small investors, with approximately 74% of Bitcoin addresses holding less than 0.01 BTC.
The study, by Grayscale Research, titled “Demystifying Bitcoin’s Ownership Landscape,” shows that approximately 74% of Bitcoin addresses contain holdings of less than 0.01 BTC, roughly equating to $350 as of Nov. 6, 2023.
This widespread distribution of Bitcoin is a stark contrast to other high-risk, high-return assets typically reserved for accredited investors.
Bitcoin’s accessibility to a global retail audience has led to a decentralized and open-source pattern in its ownership structure.
Key Findings On Large Bitcoin Holders:
Interestingly, only a small fraction (2.3%) of Bitcoin owners possess more than 1 BTC.
The report also identifies the largest Bitcoin wallet addresses, which are primarily owned by crypto exchanges and government entities, rather than individual investors.
This includes prominent exchanges like Binance (CRYPTO: BNB) and Robinhood (NASDAQ:HOOD), which collectively represent millions of users worldwide.
Institutional Involvement And Identifiable Owners:
Grayscale’s research highlights that around 40% of the total Bitcoin supply can be linked to identifiable ownership groups.
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This segment includes exchanges, government entities, public and private companies like Tesla (NASDAQ:TSLA) and Block Inc. (NYSE:BLK), mining companies securing the Bitcoin network, ETFs, wrapped BTC, and dormant addresses.
Significance Of ‘Sticky Supply’:
The concept of “sticky supply” is particularly notable in the report.
It refers to Bitcoin owners who are likely to hold onto their investments long-term.
For example, 14% of Bitcoin’s supply has not been moved in over a decade, which could include original coins owned by Bitcoin’s presumed creator, Satoshi Nakamoto, lost coins, or those held by long-term investors.
Market Implications Of Ownership Structure:
The report underscores the potential market impact of this ownership structure.
The high percentage of long-term holders and relatively inelastic supply might enhance the effect of demand-related changes on Bitcoin’s price.
This is compared to “low float” stocks in traditional markets, where limited actively traded supply can lead to significant price movements.
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