Bitcoin Forum

An increasing amount of bitcoin is being held by active individual users, rather than companies and long-term investors, according to new data from Chainalysis.

Announced Monday, the analytics firm found 4.8 million bitcoin, or roughly 32 percent of the protocol's cryptocurrency supply (minus lost coins), was held in personal wallets with some level of transactional activity as of August 31. That's up substantially from the end of 2017 – around the time the market peaked – when just 3.8 million bitcoin, or 26 percent, was in the hands of individuals.

The August numbers were the second-highest for individual accounts on record, and off only slightly from July's high of 4.95 million bitcoin, or 33 percent of all coins in circulation.

"There are more people who are holding crypto personally," Chainalysis economist Philip Gradwell told CoinDesk.

As a result, Gradwell said, "there's a much larger supply that's liquid. A lot of the people who bought [this year] are buying smaller amounts," adding:

"They are ready – if things were to change, [if] the opportunity to spend it were to arise – to actually spend it. We've kind of overcome the first hurdle of adoption, getting bitcoin into people's hands."

Speaking to that potential, Gradwell said technical solutions aimed at improving bitcoin – like the much-lauded Lightning Network, which could enable faster payment processing options for merchants and service providers – could tip the scales for users deciding whether to transact with bitcoin or cash out during the next bull market.

To be sure, bitcoin is still predominantly held as an inactive investment, whether custodied by an institution or individual, with 6.3 billion held in accounts that had no activity in over a year, according to Chainalysis data.

Further, one person can control multiple wallets, so the data is an imperfect proxy for the adoption and distribution of bitcoin.

And the original cryptocurrency's deflationary supply and dramatic appreciation in its 10 years of existence tend to incentivize users to hold rather than spend, all else equal – many bitcoin proponents view this as a feature, not a bug.

See more:https://www.coindesk.com/hodl-no-more-the-amount-of-bitcoin-in-active-wallets-is-near-to-a-record-high/

Nice to read, and thanks for posting.
However, there is still a long way to go, read this topic I just posted today > https://bitcointalk.org/index.php?topic=5037509.msg46149762#msg46149762
"Whales" still massively influent on the market at the moment, which shows we are still very far from a mature market (perhaps it's good news depending on how you look at it).

Although I am skeptical about the truth of this numbers, it may be logical:

- Hacking platforms: Investors are now more aware of keeping their coins on those platforms.
- Rising prices: The rise in the active activity of many currencies.
- Low fees: transactions fees can be ignored as the times of confirmation are relatively short.

All these factors make many interested in keeping their cryptos at personal wallets and switching to those platforms when needed.

If this numbers considered to be true which I actually doubt considering not many active users I see being their form many days and also if that was the case we would have seen in the market some movement happening upside as well which is not the case. Hope so it turn out to be true and we see good signs in coming time.

Some more interesting numbers, 42% of bitcoins stored in wallets have not moved since the peak of December 2017, and I think around 33% of Bitcoins are in the hand of only 1600 people.

Interesting statistics.

The one thing that I was going to mention is that how do they differentiate between company addresses and personal addresses? Because exchange addresses with high transaction activity can just as well be mistaken as a personal address given the level of activity going on with the deposits and redirection of funds.

Either way, it does show how much adoption has increased over the past few years probably due to the bull market of last year, mostly, but its effects have carried over to this year. The article is right though in regards to how merchant adoption has to be there so that people can have practical reason for bitcoin usage, and that's the next step imo after having an increased amount of active BTC addresses.

I speculate that a lot of those BTC was bought at relatively high prices 10k$ + and wont move before we reach at least the same level.


I suppose that there is some histroic data involved when determing the owner. Maybe big exchnages are not keeping it a secret which wallet is theirs as well.

I wouldn't call that a bug as preserving value over time is a required feature of anything pretending to be used as money. without this feature, no one would be using it or abandon it quickly if it fails to offer this option. The history knows numerous examples when currencies stopped being money, then got abandoned and forgotten. On the flip side though, it attracts various parasites which hope to get something out of nothing for just holding a few currency tokens (not necessarily bitcoin), expecting that their value will rise in due course, and thus the holders will be able to buy more with less. Obviously, someone has to pay for this seemingly "free" lunch, and these are the people who make it possible but definitely not the holders themselves. That's basically why they are parasites sitting at the top of the food chain.