Would you be able to afford a full Bitcoin after 10 years?

Out of curiosity, I was trying to analyse the total number of users of Bitcoin and more importantly serious users of Bitcoin. The results I found were very confounding!

I am outlining some interesting statistics on Bitcoin usage:

  • Total number of Bitcoins released = 16,449,227
  • Total number of addresses who own bitcoin (> 0) = 18,676,825

This would make anyone believe that the penetration of the bellwether currency is decent considering it has been around for over 8 years now.

However, when I tried to dig the number of serious users (own > 1 Bitcoin), I was amazed to see the results:

  • #Users holding over 1 Bitcoin = 535,305 (Hold 96% of the total Bitcoins)
  • #Users holding over 5 Bitcoins = 208,989 (Hold 92% of the total Bitcoins)
  • #Users holding over 6 Bitcoins = 189,912 (Hold 92% of the total Bitcoins)
  • #Users holding over 10 Bitcoins = 137,760 (Hold 88% of the total Bitcoins)
  • #Users holding over 100 Bitcoins = 13,986 (Hold 60% of the total Bitcoins)

Key takeaways from the above usage pattern:

  • Few Serious Users: There are only ~535k users who own 1 or more Bitcoin. This statistic might give a proud feeling to you if you own even if you own just one Bitcoin and are part of a very small community of serious users of Bitcoin

 

  • Only 1% of the total users hold over 90% of all the Bitcoins: Number of users holding over 6 Bitcoins is 189,912, which is 1% of the total number of Bitcoin users (18,676,825).

 

  • High Volatility of Bitcoin and Altcoins: With very few serious users, the depth of Bitcoin trading market is very shallow. And distribution is further skewed among the serious users with only ~14,000 users holding 60% of the total Bitcoins. This explains the high volatility of the price which varies significantly based on the positions taken by the serious users. While I am digging this information for altcoins, I believe the ownership for altcoins will be even more skewed and ties up with their volatility.

 

  • Bitcoin price is no bubble but just a tip of the iceberg: With bulk of the non-serious users (owning less than 1 Bitcoin) sitting on the fence, I believe the adoption of Bitcoin will significantly with any major breakthrough on the regulation or adoption.

 

  • Don’t sell your Bitcoin for next decade!: Given there will only be only 21 million Bitcoin by 2140, only 4,550,773 new Bitcoins will be released and that too at a painfully slower rate. Assuming Bitcoin survives for the next decade and maintains its scarcity value, owning it then in full shall be considered a huge asset.

1 Comment on Would you be able to afford a full Bitcoin after 10 years?

  1. I think, price will be very high by that time and it would be really expensive to buy one full bitcoin. Nice analysis Naveen.

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