As the number of whales decreases, the number of Bitcoin dolphins and sharks increases. The total of owners of small amounts of Bitcoin could be greater than that of the whales.
Super rich Bitcoin (BTC) whales, who own more than 10,000 BTC, are increasingly close to disappearing. According to blockchain data and market analyst Willy Woo, they have around 3.75% of the existing supply of coins.
Woo shared analysis on the distribution of BTC and concluded that the coins are moving towards the masses. In other words, there is a growing number of entities that own less Bitcoin.
The analyst said that the data relies on unique entities rather than addresses, as each individual can have many of them. He added that these addresses are forensically clustered into individual participants to create entities.
The researcher explained that whales usually distribute coins while making a profit on bullish market runs. However, he clarifies that the whales generally tend to decline in the long term.
The Minnows Are Eating the Bitcoin of the Whales
According to the data, there are increasingly few whales while the minnows, who own less than 10 BTC, already accumulate 13.6% of the Bitcoin in circulation. Woo argued that the latter could outperform the whales, who have 1,000 or more BTC, totaling 26% of the supply.
Although the minnows have half of Bitcoin, the picture changes when considering funds on exchanges and mutual funds. Since they are entities that guard the coins of thousands of users, their ownership is also related to small investors. When adding all those coins, there is more than 30% of the supply of Bitcoin.
The minnows seem to have only the crumbs that the whales leave behind. The long-term appreciation of Bitcoin increasingly reduces the averages of BTC per user but increases its equivalence in fiat money.
Another study by Woo indicates that the current average is between 0.25 BTC and 0.69 BTC per head. That is below the average of around 1 BTC from two years ago.
The US dollar figure has not stopped increasing, although the individual holding in Bitcoin has decreased. Taking into account 0.69 BTC per person, the total BTC exceeds USD 20,000. That figure had not exceeded 1 BTC until December 2020.
The Number of Bitcoin Dolphins and Sharks Is Rising
The school of small fish continues to grow, but Woo considered that dolphins and sharks would be the leaders of 2021. Those owners, who have between 100 BTC and 1,000 BTC, have increased in recent times.
The renowned analyst relates this growth to the entry into the market of high net worth individuals, family offices, hedge funds, and smaller corporate treasuries. He notes that these entities absorbed much of the distribution by the whales.
Lost Coins, Saved Coins, and Spent Coins
Woo excluded the coins attributed to Satoshi Nakamoto, the pseudonymous creator of Bitcoin. All those coins equal 5.8% of the BTC supply, so he would be a mega whale if considered.
The market analyst argued that he excluded those coins since Satoshi’s coins are lost coins. No one has moved those coins for more than a decade after its creator mined them. His silence for all these years suggests that those coins will not enter circulation on the network.
Some people consider not only Satoshi’s coins, but also those not moved for more than ten years, are lost. Data from Unchained Capital’s HODL Waves indicate those coins would represent more than 11% of the total Bitcoin out of circulation.
By Alexander Salazar
