The United States of Africa: An Idea Whose Time Has Come (Part VII)
Decentralization Is An Illusion: Africa Should be Wary of Bitcoin Ownership Concentration and Ethereum Ownership Concentration
BITCOIN OWNERSHIP CONCENTRATION
Bitcoin Whales: A Rising Tide of Concentrated Power
An August 2023 report from cryptocurrency data analytics firm Santiment has set off alarms within the crypto space, shedding light on the worrying concentration of Bitcoin ownership. A meager 15,870 addresses, dubbed as “whales,” are found to be in possession of an astounding 11.5 million BTC. This number equates to 59.2% of the total Bitcoin supply.
In just under three months, these formidable Bitcoin owners added a whopping 27,755 BTC to their coffers, reinforcing their powerful influence over the market. This swift uptick in concentrated ownership has rocked the crypto community, prompting serious discussions about its repercussions on market stability.
While the concept of concentrated wealth isn’t unfamiliar to cryptocurrency enthusiasts, the degree of concentration observed here challenges the very ethos of Bitcoin - its decentralization. There are concerns that this disproportionate hold on BTC might pave the way for market manipulations, undermining Bitcoin’s value as both a consistent medium of exchange and a reliable store of value.
This report has rekindled debates within the crypto industry. Many believe that the market could be at the mercy of coordinated whale movements, leading to unpredictable price surges or dips. Such dynamics would pose heightened risks for smaller investors, making them susceptible to the whims and fancies of these dominant players. The ripple effects of these potential manipulations could extend far beyond these whales, threatening the integrity of the market at large.
ETHEREUM OWNERSHIP CONCENTRATION
Top Ten Ethereum Wallets Hold Nearly 35% of Total Supply
The cryptocurrency landscape is marked by its ever-shifting tides, with trends, behaviors, and patterns evolving at a rapid pace. One of the most intriguing aspects of this realm is the distribution of ownership within blockchain networks, and the recent data presented in August 2023 by the crypto analytics platform Santiment regarding Ethereum (ETH) ownership showcases a substantial shift that has occurred over the past few years. Specifically, the top ten Ethereum wallets, known as addresses, now collectively hold nearly 35% of the cryptocurrency’s total supply. This revelation is a striking contrast to the 11.2% figure recorded in August 2018, highlighting a significant increase in the concentration of Ethereum among a select few holders.
Santiment’s data reveals that these prominent Ethereum addresses have accumulated a substantial 28 million ETH within the last five years alone, a staggering amount that accounts for 34.6% of the circulating supply. The sheer scale of this accumulation is a testament to the concentration of wealth within a relatively small group of addresses.
The shift in Ethereum’s ownership pattern offers a deep dive into the mutating undercurrents of the crypto world. It underscores the expanding clout of certain pivotal players in the market, who, with their significant holdings, are poised to shape the future course of Ethereum. As the cryptocurrency’s prominence and value burgeon, the actions and decisions of these major holders will likely cast a long shadow over market sentiment, ushering in new trends and possibly dictating the overall market direction.
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