BTC a chance to change the deadlock of 1% rich peple holding FIAT capital

[tsaroz]

Old analysis but showing that 1% of population may hold ~50% of all money: http://www.bbc.com/news/business-30875633

I wonder what are the statistics of BTC and currencies. If it reaches over 51%, there is real possibility for BTC to be controlled by 1%. This is something like centralization for me.

Cryptocurrencies are extremely centralised in terms of holders.  You have people like Roger Ver who put his money less than ten years ago and is now extremely rich.

When the price goes up too dramatically, it naturally results in centralisation unless all of those early adopters sell along the way.

Not actually,
With Fiat, The government levies tax from the high earners and tries to redistribute it.
But with bitcoin, there is no such mechanism, so bitcoin will make the rich more richer.

[Xavofat]

Old analysis but showing that 1% of population may hold ~50% of all money: http://www.bbc.com/news/business-30875633

I wonder what are the statistics of BTC and currencies. If it reaches over 51%, there is real possibility for BTC to be controlled by 1%. This is something like centralization for me.

Cryptocurrencies are extremely centralised in terms of holders.  You have people like Roger Ver who put his money less than ten years ago and is now extremely rich.

When the price goes up too dramatically, it naturally results in centralisation unless all of those early adopters sell along the way.

Not actually,
With Fiat, The government levies tax from the high earners and tries to redistribute it.
But with bitcoin, there is no such mechanism, so bitcoin will make the rich more richer.

You're basically agreeing with me, under the guise of not agreeing with me.

The current system of taxing higher earners is not working properly, because poorer people tend to spend a higher proportion of their income on static taxes e.g. VAT.  So fiat is naturally extremely uneven.

Bitcoin could naturally be similar to fiat, it's just a short term problem that dramatic surges in price have resulted in centralisation of Bitcoin holders.

[BartS]

Banks and governments love their fiat because they can steal form the people by simply printing more money, they do not have to find where your money is hidden they can steal your purchase power and they hate bitcoin because they cannot do that.

[btcney]

There is a chance that bitcoin will change this.

I would say that there are already billionaires made from cryptocurrencies. Satoshi probably has a few billion dollars which is definitely a nice chunk of coin, even though he might not spend it just yet.

I see a lot of people arguing about when bitcoin becomes widely adopted, there will still be the elite holding the majority of the coins. OF course, this is an issue. However, is there anything that can be done to change it? Besides, this discussion is about 1% rich people holding fiat, not how many bitcoins do the 1% elite hold.

[Barnabe]

Banks and governments love their fiat because they can steal form the people by simply printing more money, they do not have to find where your money is hidden they can steal your purchase power and they hate bitcoin because they cannot do that.

I agree, in my opinion, the power on money is the only thing that governments are afraid to lose. Bitcoin as a way of storing money is exactly like fiat. If someone is rich and bitcoin becomes massively adopted they will simply change their cash for bitcoins. The price increase will only create a handful of new rich early adopters. A rich person will remain a rich person even if tomorrow gold or bananas are used to trade.

[deisik]

There is a chance that bitcoin will change this

As to me, that's highly unlikely

A couple years ago there were a few threads discussing Bitcoin distribution and wealth inequality thereof, and the conclusion was not very promising overall. Bitcoin wealth distribution is as skewed as it could ever get. It was said that around 1,000 people hold (held back then) the total majority of all coins, so Bitcoin is not a lot better in this respect than fiat (in fact, it may be even badder). And what is even more discouraging, it is along the same lines with any valuable asset out there, and that seems to be sort of natural outcome even if there was an even distribution of that asset initially

[webtricks]

Considering the continuous rise in Bitcoin value, I don't feel Bitcoin will be able to change this deadlock.
Alternatively, it will follow the similar pattern as FIAT does.
Suppose someone bought BTC for $400 three years ago, now in present he automatically becomes 7 times richer than those who will buy BTC with same amount of FIAT. As a result, when cryptocurrencies will become wide-spread to 20-30% of Population, early adopters will directly comes in top 1% bracket who bought BTC at low prices as compared to those who will buy at this time because supply remains constant.

[deisik]

Considering the continuous rise in Bitcoin value, I don't feel Bitcoin will be able to change this deadlock.
Alternatively, it will follow the similar pattern as FIAT does.
Suppose someone bought BTC for $400 three years ago, now in present he automatically becomes 7 times richer than those who will buy BTC with same amount of FIAT. As a result, when cryptocurrencies will become wide-spread to 20-30% of Population, early adopters will directly comes in top 1% bracket who bought BTC at low prices as compared to those who will buy at this time because supply remains constant

Top holders are not early adopters for the most part

Indeed, some have been holding their coins since inception (e.g. Satoshi with his 1M stash of bitcoins), but their numbers are set to decrease with time, this is inevitable. Some of them are just passing away (like Hal Finney) and then their coins are either lost for good or just wasted (well, sold) by their inheritors and relatives. Some of them lost their coins in the Mt. Gox scam. Those who didn't likely sold the best part of their stashes anyway. The bottom line is that the top bracket almost always has a considerable part of nouveaux riches (so-called new money). It is the same with fiat, for example, Bill Gates and Warren Buffett make up new money (while Rothschilds and Rockefellers are old money)

[pearlmen]

I think, there is another big thing why BTC is so treated hostile. Banks have their own interest. But many rich people are very addicted to FIAT connotations and the structure of cryptocurrency may change the general structure of possession.
This may build a thesis that:
- crypto currencies are pumped to give a strike in a moment to 'alienate the fashion' to BTC and show how 'BTC and crypto' is bad for the economic system
- or they are locking into positions to make is centralized through smooth control of the course of crypto
- or it is just a sheep run pump, as it goes.

I would like to open a discussion on that. What do you think?

Your point of view is one way to look at it but on the other hand, it worthy to note that the issue of bitcoin prices is actually dependent of the majority moving with the swings in terms of prices. Its possible we might not be able to separate the human artificial factor in the determination of prices, but at the same time, the majority give them the power to do so by falling in line as a result of panic buying or selling. But if we are to maintain our position, we then realize that the forces are just too minute to determine our direction.

[ImHash]

Yes bitcoin is bad for economic system, it smells like sh*t better not to touch it, I'm talking to the 1% holding fiat rich people you hear me?
People now are using crypto currencies for 2 reasons:

1- To have the freedom over their money without any governmental intervention.
2- To earn pure profit by pump & dump.
I see no problem with that.

[BartS]

Old analysis but showing that 1% of population may hold ~50% of all money: http://www.bbc.com/news/business-30875633

I wonder what are the statistics of BTC and currencies. If it reaches over 51%, there is real possibility for BTC to be controlled by 1%. This is something like centralization for me.

In my country it is even worst about 20 families control more than 80% of the riches of the country, there is never going to be any kind of social mobility since they control everything in the country, bitcoin gives us chance to make money outside of fiat and all of their controls in the economy.

[d5000]

I think this is an interesting question, but we shouldn't analyze "wealth" in a static way. Wealth is often a dynamic process, where "money works" over time and feeds a certain class of people (those relying on profits inside the "financial system").

In this context I think Bitcoin and cryptocurrencies can definitively change something, because it provides an alternative to the banking system. "Crypto banking" is still not highly developed and it has a lot of problems, including the volatility of cryptocurrencies, but I see potential for it to replace the current banking system at some point in the future.

As Bitcoin is more transparent than the traditional banking system, there will be less chances for middlemen to "steal" money out of the system than it happens with the current banking system. That means that the cycle that feeds the elites that benefit from the financial system is weakened.

So Bitcoin could weaken the financial sector and instead boost the economic sector that produces "real world" economic goods and services. We'll have the "financial elite" then replaced by an "industrial elite" and a very small "Bitcoin elite".

[Slark]

There is no way to prevent uneven bitcoin distribution.

In the end when Bitcoin will turn out to be a legit, true and successful asset then rich FIAT holders simply liquidate their fiat positions in favour of BTC.
Nothing will really change, rich will be richer and poor wouldn't still be able to afford to buy enough BTC to change their life.
What bitcoin brought to the scene is more people, mainly early adopters, who will be extremely rich in the future.

[warrior333]

If the rich people begin to convert their Fiat money into bitcoin will dramatically increase demand, and hence will raise the price. Everyone who has coins can win. I'll keep the coins and wait for this moment.

[Mometaskers]

It's more likely that the government and banking industry would try to regulate cryptocurrencies. Money stored in it after all would be hard to tax (bad for government) and can't be lent out (bad for bankers).

As for bitcoin reducing the fiat of the rich, they are just exchanging it for bitcoins so they still have their asset. And assuming it keeps going on an upward trajectory, then the rich earn much more. And this is money they might not be taxed for. The rich become richer, always. Nothing, nothing ever changes.

http://www.pbs.org/newshour/making-sense/column-conquerors-inequality-four-horsemen-apocalypse/

[iluvpie60]

Well it isn't much of a chance to change the 1%. More like it adds to the 1% if you think about it.

The 1% have only a few million dollars USD just so you are aware. And that is their networth, not how much is in a bank account. Networth includes your bank account + stocks +stock futures + your house + your car + your business.

A lot of small businses owners are in the 1% if their business survives for 5 to 10 years. Most people who put into their retirement fund when they retire have millions of dollars that is used for retirement.


For peope who didn't have a retirement fund like a Roth IRA or a 401k, their money was taxed while they worked for 40 to 50 years, that money is then given to them in social benefits. So they technically have millions of dollars of networth too that is paid out monthly over 20 to 30 years.

The 1% is more like the 70% in America, because a lot of Americans will get this money or have a retirement fund, the 1% is misleading because that is comparing it to the rest of the world.

[deisik]

There is no way to prevent uneven bitcoin distribution.

In the end when Bitcoin will turn out to be a legit, true and successful asset then rich FIAT holders simply liquidate their fiat positions in favour of BTC.
Nothing will really change, rich will be richer and poor wouldn't still be able to afford to buy enough BTC to change their life

As to me, this is an unlikely scenario

With Bitcoin we likely have a wave of new money coming in (the so-called nouveaux riches). Obviously, fiat deep pockets (those will represent old money) will be in a subdued position if we assume that they would ever want to switch to Bitcoin one day (they will be running after ever evading prices like a kitten trying to catch its tail). This is certainly not what they will like because they simply can't accept this state of affairs. So they will likely try to fight Bitcoin whenever it starts to threaten their financial hegemony

[richardsNY]

So they will likely try to fight Bitcoin whenever it starts to threaten their financial hegemony

That might be the case when it comes to a smaller number of stubborn people, but everyone else with a decent level of economical understanding, will definitely not sit back and look how their fiat wealth is slimming down in value year after year. It doesn't mean they need to go all in, but it wouldn't hurt to convert around 25% of their fiat wealth to Bitcoin. If that's too risky for them, they could even go with 12.5% gold and 12.5% Bitcoin if that gives them a better feeling.

[GreenBits]

There is no way to prevent uneven bitcoin distribution.

In the end when Bitcoin will turn out to be a legit, true and successful asset then rich FIAT holders simply liquidate their fiat positions in favour of BTC.
Nothing will really change, rich will be richer and poor wouldn't still be able to afford to buy enough BTC to change their life

As to me, this is an unlikely scenario

With Bitcoin we likely have a wave of new money coming in (the so-called nouveaux riches). Obviously, fiat deep pockets (those will represent old money) will be in a subdued position if we assume that they would ever want to switch to Bitcoin one day (they will be running after ever evading prices like a kitten trying to catch its tail). This is certainly not what they will like because they simply can't accept this state of affairs. So they will likely try to fight Bitcoin whenever it starts to threaten their financial hegemony

Amen. The capitalization of the average 'rich' bitcoiner pales in comparison to the dynastic wealth of the truly rich, the actual 1%. Bitcoin would have to go to infinity to catch up with these guys,, there are folks on the Forbes list that are worth GDPs of small third world nations. Old money wouldn't have time for all the new, disruptive money running around, lobbying and whatnot and mucking up the general state of affairs.  And the government gets the most of its bread and butter from the top of the ladder. If bitcoin threatened the status quo, it will be regulated to a fine mist

[el kaka22]

Old analysis but showing that 1% of population may hold ~50% of all money: http://www.bbc.com/news/business-30875633

I wonder what are the statistics of BTC and currencies. If it reaches over 51%, there is real possibility for BTC to be controlled by 1%. This is something like centralization for me.

In my country it is even worst about 20 families control more than 80% of the riches of the country, there is never going to be any kind of social mobility since they control everything in the country, bitcoin gives us chance to make money outside of fiat and all of their controls in the economy.

This is something shocking a country whose 80% or more of the economy is when under the control of so called 20 families the people of that country must be facing too much hindrances in continuing the financial growth because almost everything and institution will be in their approach and they may not give a chance to others to grow financially and as well socially.

I feel pity for the people there. Bitcoin in such circumstances will be of a great help for the people there because it will not be in their control and so people can carry on working in bitcoin.