Distribution of bitcoin wealth by owner

[Adrian-x]

So 14,000 people own roughly 72% of all bitcoin? If there are 1 million users, then the top 1.4% owns 72% of everything? That seems high.

Yes, you get that right.

Don't believe the fairly tale that bitcoin is fair and liberated.

Bitcoin is at the beginning of its distribution cycle, nothing is fair, but unlike fiat having a lot of Bitcoin and not spending it doesn't alow you to accumulate more wealth. In the fiat world if you're part of the 0.01% you get paid to be the majority wealth holder. By contrast in Bitcoin if you are a majority holder you lose a lot more wealth than the wealth you cash out when you cash out.

What makes your Bitcoin grow in value is the size of the network of users, finding ways to distribute it to the people who will be responsible is not a trivial science. It would be prudent to only trust people to be responsible with there money when it comes at great hardship and expense.

So holding if you are a stake holder is hard, you need to spend it strategically to make the network grow, and manage it like you're the FED. Watching the velocity, because there are other stake holders with the same knowledge but they are in competition.

The fact is it's working extremely well, we've grown exponentially by an order of magnitude every year to date since inception.
Now that's what I find hard to believe.

How in hell holding bitcoin doesn't make you more wealthy? If things go as they should, as bitcoin becomes more popular, the price of bitcoin should go up. So if you own a lot of bitcoin already, all you have to do is wait and you'll be getting ridiculously rich in 10 years. So yes, waiting and holding = more wealth, so there is a big incentive to hold and not to spend. What are you winning by spending bitcoin?

There are some with a lot of Bitcoin - for them it's about increasing the total value relative to the potential success of Bitcoin, not the amount of Bitcoin they have.
Holding makes everyone more wealthy only if others want to join in. One way to think of it is Bitcoin will be nearing optimum market saturation when the wealth in Bitcoin is distributed on a normal bell curve.

The value of the network has grown somewhat correlated to Metcalfe's law it seems the more people who use Bitcoin the more valuable it becomes.

One just has to do one's best to make the network more valuable, if everyone held and the network stopped growing the value of Bitcoin would drop. Generally speaking holding at any time of the 5 out of 6 years has been more profitable than trading for the average investor.

In market theory capital accumulates where it is used most productivity, and to think more than 1 out of every 1000 is more productive than 500 out of every 1000 people is evidence that we have problems, Bitcoin won't be successful if the disparity is similar.

Most involved must hold but you also need to let some go. Generally rpietila savings plan is a good start.

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[KJO]

You think bitcoin distribution is unfair?

LMAO. Only delusional ignorant idiots would question the fairness of bitcoin after realizing the top 1% own more than half the entire fucking currency pool on the planet. Here you go idiots:

http://www.forbes.com/sites/laurashin/2014/01/23/the-85-richest-people-in-the-world-have-as-much-wealth-as-the-3-5-billion-poorest/

[rpietila]

You think bitcoin distribution is unfair?

LMAO. Only delusional ignorant idiots would question the fairness of bitcoin after realizing the top 1% own more than half the entire fucking currency pool on the planet. Here you go idiots:

http://www.forbes.com/sites/laurashin/2014/01/23/the-85-richest-people-in-the-world-have-as-much-wealth-as-the-3-5-billion-poorest/

I think it is somewhat annoying that 85 richest own half of the circulating currency.

Much more alarming, though, is that 99% of the money supply of the world is emitted or withdrawn by only a handful of men.

[arklan]

You think bitcoin distribution is unfair?

LMAO. Only delusional ignorant idiots would question the fairness of bitcoin after realizing the top 1% own more than half the entire fucking currency pool on the planet. Here you go idiots:

http://www.forbes.com/sites/laurashin/2014/01/23/the-85-richest-people-in-the-world-have-as-much-wealth-as-the-3-5-billion-poorest/

I think it is somewhat annoying that 85 richest own half of the circulating currency.

Much more alarming, though, is that 99% of the money supply of the world is emitted or withdrawn by only a handful of men.

in short, the world... is fucked.

[pattu1]

You think bitcoin distribution is unfair?

LMAO. Only delusional ignorant idiots would question the fairness of bitcoin after realizing the top 1% own more than half the entire fucking currency pool on the planet. Here you go idiots:

http://www.forbes.com/sites/laurashin/2014/01/23/the-85-richest-people-in-the-world-have-as-much-wealth-as-the-3-5-billion-poorest/

I agree... Bitcoin's distribution is by no means unfair.
Especially, when you look at inequality in the real world.

[Vlad2Vlad]

You think bitcoin distribution is unfair?

LMAO. Only delusional ignorant idiots would question the fairness of bitcoin after realizing the top 1% own more than half the entire fucking currency pool on the planet. Here you go idiots:

http://www.forbes.com/sites/laurashin/2014/01/23/the-85-richest-people-in-the-world-have-as-much-wealth-as-the-3-5-billion-poorest/

I agree... Bitcoin's distribution is by no means unfair.
Especially, when you look at inequality in the real world.

What are you guys taking about?

Bitcoin wealth ownership is 10 times as centralized as paper fiat - .1% control nearly 50% of all Bitcoins with one single guy controlling nearly 10%. lol. 

The only thing Bitcoin is missing is a centralized board [like the Fed reserve board] to control the protocol which I think is forthcoming.

[Adrian-x]

You think bitcoin distribution is unfair?

LMAO. Only delusional ignorant idiots would question the fairness of bitcoin after realizing the top 1% own more than half the entire fucking currency pool on the planet. Here you go idiots:

http://www.forbes.com/sites/laurashin/2014/01/23/the-85-richest-people-in-the-world-have-as-much-wealth-as-the-3-5-billion-poorest/

I agree... Bitcoin's distribution is by no means unfair.
Especially, when you look at inequality in the real world.

What are you guys taking about?

Bitcoin wealth ownership is 10 times as centralized as paper fiat - .1% control nearly 50% of all Bitcoins with one single guy controlling nearly 10%. lol. 

The only thing Bitcoin is missing is a centralized board [like the Fed reserve board] to control the protocol which I think is forthcoming.

It's very different, you don't have a choice with the fiat system, but with Bitcoin you have a choice. Choosing Bitcoin is accepting all it is, there is an understanding that the people who have chosen to store wealth on the blockchain want it to succeed.

So the disparity will more likely diminish over time than concentrate, this is the opposite of the current system.

[pereira4]

You think bitcoin distribution is unfair?

LMAO. Only delusional ignorant idiots would question the fairness of bitcoin after realizing the top 1% own more than half the entire fucking currency pool on the planet. Here you go idiots:

http://www.forbes.com/sites/laurashin/2014/01/23/the-85-richest-people-in-the-world-have-as-much-wealth-as-the-3-5-billion-poorest/

I agree... Bitcoin's distribution is by no means unfair.
Especially, when you look at inequality in the real world.

What are you guys taking about?

Bitcoin wealth ownership is 10 times as centralized as paper fiat - .1% control nearly 50% of all Bitcoins with one single guy controlling nearly 10%. lol. 

The only thing Bitcoin is missing is a centralized board [like the Fed reserve board] to control the protocol which I think is forthcoming.

It's fucking silly. If big Bitcoin holders cared about the outcome of BTC they should be doing giveaways for the community instead of sitting their pig fat asses on mountains of BTC as it keeps crashing.

[Tirapon]

You think bitcoin distribution is unfair?

LMAO. Only delusional ignorant idiots would question the fairness of bitcoin after realizing the top 1% own more than half the entire fucking currency pool on the planet. Here you go idiots:

http://www.forbes.com/sites/laurashin/2014/01/23/the-85-richest-people-in-the-world-have-as-much-wealth-as-the-3-5-billion-poorest/

I agree... Bitcoin's distribution is by no means unfair.
Especially, when you look at inequality in the real world.

What are you guys taking about?

Bitcoin wealth ownership is 10 times as centralized as paper fiat - .1% control nearly 50% of all Bitcoins with one single guy controlling nearly 10%. lol. 

The only thing Bitcoin is missing is a centralized board [like the Fed reserve board] to control the protocol which I think is forthcoming.

It's fucking silly. If big Bitcoin holders cared about the outcome of BTC they should be doing giveaways for the community instead of sitting their pig fat asses on mountains of BTC as it keeps crashing.

If you start giving out BTC to randomers on the internet, most of them will probably sell immediately and pocket the fiat. That's not gonna help anything.

[BTCLotto]

Man, took forever to go through 50% of this thread! lol

[keithers]

would love to see an update on this and compare how the statistics have changed over the past couple of years...

[El Emperador]

would love to see an update on this and compare how the statistics have changed over the past couple of years...

Me too.
I'm pretty sure, for example, that in more than 1 year the estimated Bitcoin holders are, at least, doubled... and also the sentence " thanks to Mt.Gox data " should be deleted 

[DonQuijote]

Where can i see the % now?

[manselr]

Where can i see the % now?

http://bitcoinrichlist.com/charts/percent-bitcoins-owned-by-richest

[JorgeStolfi]

would love to see an update on this and compare how the statistics have changed over the past couple of years...

Me too.
I'm pretty sure, for example, that in more than 1 year the estimated Bitcoin holders are, at least, doubled... and also the sentence " thanks to Mt.Gox data " should be deleted 

Let's assume that a person  who is really a "bitcoin holder" mus thave at least one address with at least 0.1 BTC in it.

The the number of addresses in the blockchain with at least 0.1 BTC was ~450'000 in January, ~650'000 in September.

Beware that these numbers are only approximate upper bounds for the number of bitcoiners.  If I had less than 1 million $ in 2013, and now have less than 2 million $, I cannot assume that I have done well...

# Distribution of bitcoins by address on 2014-01-12
# From http://bitcoinrichlist.com/charts/bitcoin-distribution-by-address?atblock=280000

BTC balance          ! Num.addresses ! % of addresses !        Tot BTC ! % of all BTC
---------------------+---------------+----------------+----------------+-------------
0 - 0.001            |    24,412,755 |          95.46 |        173.217 |          .  
0.001 - 0.01         |       306,842 |           1.20 |      1,171.717 |         0.01
0.01 - 0.1           |       376,262 |           1.47 |     11,759.442 |         0.10
---------------------+---------------+----------------+----------------+-------------
SUBTOTAL             |    25,095,859 |          98.13 |     13,104.376 |         0.11
---------------------+---------------+----------------+----------------+-------------
0.1 - 1              |       217,753 |           0.85 |     75,192.088 |         0.61
1 - 10               |       157,801 |           0.62 |    444,006.086 |         3.63
---------------------+---------------+----------------+----------------+-------------
SUBTOTAL             |       375,554 |           1.47 |    519,198.174 |         4.24
---------------------+---------------+----------------+----------------+-------------
10 - 100             |        88,820 |           0.35 |  3,306,869.210 |        27.00
100 - 1,000          |        11,627 |           0.05 |  2,795,725.883 |        22.83
---------------------+---------------+----------------+----------------+-------------
SUBTOTAL             |       100,447 |           0.40 |  6,102,595.093 |        49.83
---------------------+---------------+----------------+----------------+-------------
1,000 - 10,000       |         1,344 |           0.01 |  3,051,247.207 |        24.91
10,000 - 100,000     |            96 |            .   |  2,305,773.269 |        18.83
100,000 - 21,000,000 |             2 |            .   |    255,456.131 |         2.09
---------------------+---------------+----------------+----------------+-------------
SUBTOTAL             |         1,442 |           0.01 |  5,612,476.607 |        45.83
---------------------+---------------+----------------+----------------+-------------
TOTAL                |    25,573,302 |         100.01 | 12,247,374.250 |       100.01
---------------------+---------------+----------------+----------------+-------------

# Distribution of bitcoins by address on 2014-09-10
# From http://bitcoinrichlist.com/charts/bitcoin-distribution-by-address?atblock=320000

BTC balance          ! Num.addresses ! % of addresses !        Tot BTC ! % of all BTC
---------------------+---------------+----------------+----------------+-------------
0 - 0.001            |    44,917,388 |          96.47 |        288.600 |          .  
0.001 - 0.01         |       468,390 |           1.01 |      1,815.552 |         0.01
0.01 - 0.1           |       545,136 |           1.17 |     16,415.880 |         0.12
---------------------+---------------+----------------+----------------+-------------
SUBTOTAL             |    45,930,914 |          98.65 |     18,520.032 |         0.13
---------------------+---------------+----------------+----------------+-------------
0.1 - 1              |       300,665 |           0.65 |    104,450.810 |         0.79
1 - 10               |       214,170 |           0.46 |    605,575.673 |         4.57
---------------------+---------------+----------------+----------------+-------------
SUBTOTAL             |       514,835 |           1.11 |    710,026.483 |         5.36
---------------------+---------------+----------------+----------------+-------------
10 - 100             |        99,925 |           0.21 |  3,557,378.156 |        26.85
100 - 1,000          |        13,813 |           0.03 |  3,145,684.530 |        23.75
---------------------+---------------+----------------+----------------+-------------
SUBTOTAL             |       113,738 |           0.24 |  6,703,062.686 |        50.60
---------------------+---------------+----------------+----------------+-------------
1,000 - 10,000       |         1,445 |            .   |  3,210,486.390 |        24.23
10,000 - 100,000     |            95 |            .   |  2,178,395.722 |        16.44
100,000 - 21,000,000 |             3 |            .   |    426,872.355 |         3.22
---------------------+---------------+----------------+----------------+-------------
SUBTOTAL             |         1,543 |            .   |  5,815,754.467 |        43.89
---------------------+---------------+----------------+----------------+-------------
TOTAL                |    46,561,030 |         100.00 | 13,247,363.668 |        99.98
---------------------+---------------+----------------+----------------+-------------

[rpietila]

The methodology 31 pages ago states that a bitcoin owner is a person who "owns" bitcoins valued at least $1.

The ownership is regardless of how they are distributed in addresses, therefore the number of owners may be higher or smaller than the number of addresses holding bitcoins that are valued at least $1.

There are several ways of holding bitcoins that do not directly correspond to addresses. Coinbase alone is supposed to have 2.5 million clients, and they serve one country only. Similarly (I cannot divulge exactly this business-critical information) in another country, the leading bitcoin merchant has 0.6% of the country's population as clients.

The number of bitcoins is known information, as well as the market cap. What can be said with certainty, is that the average holding of bitcoins, especially valued in fiat, has declined significantly after (probably) being more than $10,000 in the last peak valuation.

When I find the time, I will surely return to this interesting topic. The hibernation is the time of holding for the past holders, and accumulation for the new ones. When the price starts to move, I will be back. Just as I said after the April-13 peak had deflated. And did

[JorgeStolfi]

The methodology 31 pages ago states that a bitcoin owner is a person who "owns" bitcoins valued at least $1.

Well, that is a rather low threshold.  It is not useful for investment or purchasing, not even in third-world countries.  It would include many people who tried bitcoin but did not like it, were stuck with 0.005 BTC left over from their experiment, cannot spend it and see no point in cashing it out.

The ownership is regardless of how they are distributed in addresses, therefore the number of owners may be higher or smaller than the number of addresses holding bitcoins that are valued at least $1.

I understand that, and agree that the total amount owned is the right metric for defining a "bitcoin holder" (although I disagree about the threshold).

My premise was that *if* someone keeps their coins in personal wallets, then at least one address in those wallets must hold a significant fraction of his holdings.  Said another way, someone who owns no address with more than 0.1 BTC probably does not have more than a couple BTC in his wallets.  Thus, the number of addresses with at least X BTC is likely to be an upper bound on the number of people who hold at least 10*X BTC in their wallets.

There are several ways of holding bitcoins that do not directly correspond to addresses. Coinbase alone is supposed to have 2.5 million clients, and they serve one country only. Similarly (I cannot divulge exactly this business-critical information) in another country, the leading bitcoin merchant has 0.6% of the country's population as clients.

Well, that would mean that the vast majority of bitcoin holders actually holds IOUs from "bitcoin banks" like Coinbase or the exchanges.  That would be a disconcerting fact if it were confirmed.

Or, perhaps those companies are counting inactive users with pennies in their accounts (like MtGOX did, as you pointed out yourself).

[rpietila]

Or, perhaps those companies are counting inactive users with pennies in their accounts (like MtGOX did, as you pointed out yourself).

I agree with your premise that there are several "classes" of holders. There is even a high-quality thread that discusses the concept:

First Class - 30% of the coins, <0.1% of the holders
Business Class - 30%, 3%
Middle Class - 30%, 17%
Entry Class - 10%, 80%.

In the Entry Class, many hold only a very meager amount, but this (deciding to buy, and going through the hurdles of doing it) is much better than not being at that point yet, or not even knowing about Bitcoin. So it surely must count.

It is difficult to go around the facts that show that several million people have tried Bitcoin. Of them, the number of continuous, active, users is still less than a million, which can easily be seen from the blockchain address usage activity. How much less, the answer would warrant some thorough analysis by an impartial analyst.

[jehst]

Or, perhaps those companies are counting inactive users with pennies in their accounts (like MtGOX did, as you pointed out yourself).

I agree with your premise that there are several "classes" of holders. There is even a high-quality thread that discusses the concept:

First Class - 30% of the coins, <0.1% of the holders
Business Class - 30%, 3%
Middle Class - 30%, 17%
Entry Class - 10%, 80%.

In the Entry Class, many hold only a very meager amount, but this (deciding to buy, and going through the hurdles of doing it) is much better than not being at that point yet, or not even knowing about Bitcoin. So it surely must count.

It is difficult to go around the facts that show that several million people have tried Bitcoin. Of them, the number of continuous, active, users is still less than a million, which can easily be seen from the blockchain address usage activity. How much less, the answer would warrant some thorough analysis by an impartial analyst.

I'm Business Class in BTC and definitely First Class in XMR. when will i get rich?  

[rpietila]

I'm Business Class in BTC and definitely First Class in XMR. when will i get rich?  

I believe the key is in empowering and providing services to the class that is one below your own.

With this in mind, I have been aiming my Bitcoin Supernode initiatives to the ones having BTC100-BTC10,000, and my XMR hangaround gang is also the large holders.