1,000 People Own 40 Percent of the Bitcoin Market

Megalith

Megalith

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About 40 percent of bitcoin is held by perhaps 1,000 users, and they could send prices plummeting by selling even a portion of their holdings. Some fear that these large owners, dubbed “whales,” will band together to tank or prop up the market.

“As in any asset class, large individual holders and large institutional holders can and do collude to manipulate price,” Ari Paul, co-founder of BlockTower Capital and a former portfolio manager of the University of Chicago endowment, wrote in an electronic message. “In cryptocurrency, such manipulation is extreme because of the youth of these markets and the speculative nature of the assets.”
 
I'm not surprised by this. Back in the day it was pretty easy to collect a rather sizable amount of coins. Earlier still, it was cheaper but you'd have to go through extreme lengths for coins from Chinese. Now you have people with mass mining operations with multi-million dollar income per month like that dude in Washington racking in 8 mil a month.

...I'd be happy with 3 coins. Would make a large difference is an understatement.
 
RogueTadhg said:
...I'd be happy with 3 coins. Would make a large difference is an understatement.
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I know that feeling all too well as I just noted in another thread here discussing Bitcoin that back in 2010 I had mined 3 full bitcoin (actually about 3.04 iirc) and then never backed up the wallet or even saved the address nor the passphrase and now, of course, I sincerely wish I had those 3 bitcoin at this point in time. Even with crazy conversion fees or even just using them directly to make some purchases of material items they could literally and totally change my life (and my wife's) but I suppose shit happens.

Some things just weren't meant to be I suppose, but like many others I'll be kicking myself for years to come over not handling that situation with a little more caution. ;(
 
Tiberian said:
I know that feeling all too well as I just noted in another thread here discussing Bitcoin that back in 2010 I had mined 3 full bitcoin (actually about 3.04 iirc) and then never backed up the wallet or even saved the address nor the passphrase and now, of course, I sincerely wish I had those 3 bitcoin at this point in time. Even with crazy conversion fees or even just using them directly to make some purchases of material items they could literally and totally change my life (and my wife's) but I suppose shit happens.

Some things just weren't meant to be I suppose, but like many others I'll be kicking myself for years to come over not handling that situation with a little more caution. ;(
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Agreed. I've learned quite a bit from this experience.

But the thought of wealth transferring hands into those that didn't get a silver spoon is a nice thought. The gap of wealth closed with Bitcoin's rise. I hope that those that now suddenly find themselves with a wealth of money doesn't come back to bite them in the ass, like so many lottery winners.
 
Not everyone who is wealthy got a "silver spoon." Sometimes you work hard, sometimes you make good decisions, sometimes you just don't lose track of your bitcoins.

I remember when BTC first came around, I sold my Eyefinity 6 5870 to some guy on here for $300 and thought he was an idiot for overpaying for a used video card...lol. I have my own bitcoin sob stories, but at least I made $5k a few years ago...of course, today that would be worth $150k, but I won't worry about that :).

Honestly, given what we know about bitcoin, it kind of makes sense to throw $500-1000 at it and leave it there for 10-15 years to see what happens. Worst case you lose $500. Best case you might have a couple thousand bucks at your disposal.
 
You have to realize that while those 1,000 people or entities that have control of that ~40% of the total bitcoin that's been mined so far don't have actual wealth in hand like it's a huge pile of cash or something just as Bill Gates doesn't have $80 billion in his pocket nor does Jeff Bezos has $100+ billion in his either, it's strictly on paper (so to speak) and the problem with bitcoin is that it honestly has absolutely nothing backing it up except for the value that people are putting on it. Gates has his Microsoft shares of stock, an actual real world commodity item, just as Bezos has his Amazon stocks and other investments.

Sure there are a lot of people that were wealthy already - the most notable being the Winklevi aka Winklevoss twins of "almost but not quite Facebook" fame who sank a chunk of their family wealth into a few years ago. They were NOT original investors and really didn't get involved until around late 2014 according to published info so, it's not like they saw it early on, they happened upon bitcoin like many others when it garnered a lot of publicity with the first few big valuations.

So while an awful lot of people do hold bitcoin presently that doesn't automagically make them wealthy, as weird as that sounds - and yes I do realize that in the other post I just made I pointed out that even just the 3 bitcoin I mined and lost in the passage of time would make a rather dramatic difference in my life right now but that's only because if I had them I could and would actually put them to use - these people that are hodling as the joke goes aren't in any real positions of dumping them in mass quantities even though they could.
 
Very true. Those with mass quantities of BTC holding do wonder when they're going to start unloading their coins. Risk management would dictate to unload half at a time, at certain points to make sure that you're not caught on the other side of the wave. Having thousands of coins mean little until you put it into cash. The wealthy tend to also have other investments or other ways of earning money, Renters, Real Estate, Hedge funds. But for those adults/kids that find themselves with wealth overnight, is whom I'm speaking about. They are the lucky ones :)
 
Tiberian said:
You have to realize that while those 1,000 people or entities that have control of that ~40% of the total bitcoin that's been mined so far don't have actual wealth in hand like it's a huge pile of cash or something just as Bill Gates doesn't have $80 billion in his pocket nor does Jeff Bezos has $100+ billion in his either, it's strictly on paper (so to speak) and the problem with bitcoin is that it honestly has absolutely nothing backing it up except for the value that people are putting on it. Gates has his Microsoft shares of stock, an actual real world commodity item, just as Bezos has his Amazon stocks and other investments.
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How is stock a real world commodity item but bitcoin isn't? I have seen major retailers accepting bitcoin as a form of payment (meaning it can be used in place of the USD) but I haven't seen one willing to take Amazon or Microsoft stock as a form of payment yet. Microsoft itself accepts bitcoin as payment, yet you consider it not to be useful or valued (one of the definitions of commodity) compared to stock? It's not like it's a Beanie Baby that people are comparing to currency.
 
ZiggyDeath said:
Huge liquidity issue if they wanted to cash out. Would likely crash the market.
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Huge liquidity issue if stockholders of traditional equity markets wanted to cash out too. What's your point? No thousand people are going to all suddenly decide to do anything at the same time.

Jeff Bezos is one guy, guess what would happen if he cashed out his lions share of Amazon stock?

If anything it's the publicly traded megacorp's that have their stock ownership way more consolidated into a handful of shitheads at the very top. And I'd be way more nervous of any of them cashing out moments before the stock market finally gets the correction that's about 2 years overdue. It's living on a wing and a prayer.
 
bristol17 said:
How is stock a real world commodity item but bitcoin isn't?
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Because it isn't tied to an actual real world company. Its basically vaporware. Just because a retailer accepts it doesn't make it an accepted form of currency.
 
Krenum said:
Because it isn't tied to an actual real world company. Its basically vaporware. Just because a retailer accepts it doesn't make it an accepted form of currency.
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At the end of the day, what difference does it make? Vaporware or not, some people turned $10 into $15,000. Some people think it's going to be "worth" more and are holding. No one is telling you that you have to "invest" or spend your money on it. Also, a commodity isn't the same as a currency. Right now it seems like it's being treated more like a commodity than a currency. You don't walk into the grocery store and pay with corn futures do you?
 
Krenum said:
Because it isn't tied to an actual real world company. Its basically vaporware. Just because a retailer accepts it doesn't make it an accepted form of currency.
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It doesn't make it an accepted form of currency to the retailer that accepted it as currency? Are you sure? Just because YOU won't accept it as currency doesn't define it as such. Which single "company" is the USD tied to? Again I would recommend looking up the definition of "commodity" as previously suggested.
 
bristol17 said:
It doesn't make it an accepted form of currency to the retailer that accepted it as currency?
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It isn't regulated as a form of currency only a property. It has no value than what its worth to the person who accepts it. Like a chunk of ore. So yeah, its a commodity.
 
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The whale situation is the single biggest potential threat to Bitcoin I think there is. Bitcoin has a demand, it has recognition, it's gaining legitimacy, and a handful of people can flatten the market if they choose to sell off in bulk.... great.
 
DPI said:
Huge liquidity issue if stockholders of traditional equity markets wanted to cash out too. What's your point? No thousand people are going to all suddenly decide to do anything at the same time.

Jeff Bezos is one guy, guess what would happen if he cashed out his lions share of Amazon stock?

If anything it's the publicly traded megacorp's that have their stock ownership way more consolidated into a handful of shitheads at the very top. And I'd be way more nervous of any of them cashing out moments before the stock market finally gets the correction that's about 2 years overdue. It's living on a wing and a prayer.
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I'm not disputing this. This is more or less true, Bezos holds 17% of Amazon, and he would cause the price of AMZN to crash if he were to dispose of it.

However, the difference between the stock market versus bitcoin and cryptocurrency, is that almost all crypotos are pegged to BTC or ETH; is that if BTC crashes, it crashes all the other coins associated with it.

While you could make a similar argument for AMZN and a ripple effect, the fact is if he were to dispose of his stock there would be warning signs due to regulatory requirements.
 
Soooo... Bitcoin is just like the US Dollar? A small group of people have most of it and the rest of us have the scraps?
 
Satoshi is dead. That's like 2M coins out of the potential 21M gone right there.

Guy earlier in the thread lost 3 in a wallet mishap, many thousands more guys just like that.

Cry tulip all you like, Bitcoin is not the bubble...it is the needle.
 
bristol17 said:
How is stock a real world commodity item but bitcoin isn't? I have seen major retailers accepting bitcoin as a form of payment (meaning it can be used in place of the USD) but I haven't seen one willing to take Amazon or Microsoft stock as a form of payment yet. Microsoft itself accepts bitcoin as payment, yet you consider it not to be useful or valued (one of the definitions of commodity) compared to stock? It's not like it's a Beanie Baby that people are comparing to currency.
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Right, because I’m sure people are totally going to spend a currency that has wild swings in valuation in excess of 20% in a day as the norm right now. Let’s be honest, Bitcoin is currently failing at its stated purpose of “being a currency” and is currently being treated as a commodity that’s supposedly in demand but, in actual fact, has very little utility at this point and has nothing backing it up.
 
bristol17 said:
It isn't regulated so it isn't currency? Good to know.

https://www.cnbc.com/2015/01/26/bitcoin-gets-first-regulated-us-exchange.html

We won't see eye to eye on this probably ever so I'm just going to let it go.
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Regulated exchange and regulated currency are completely different things. Regulations on the exchange will dictate rules of operation for trading Bitcoin, but they do not make it legal tender for settling debts. Send the IRS some Bitcoin and let me know if it settles your taxes.
 
DPI said:
Boom.

Whole lot of missed-boat anger shows up every time the word Bitcoin appears in a thread title.

I swear it's like a batsignal for dumb and angry. Every time.
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Is it on talk radio now or something?
 
HockeyJon said:
Right, because I’m sure people are totally going to spend a currency that has wild swings in valuation in excess of 20% in a day as the norm right now. Let’s be honest, Bitcoin is currently failing at its stated purpose of “being a currency” and is currently being treated as a commodity that’s supposedly in demand but, in actual fact, has very little utility at this point and has nothing backing it up.
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I know bitcoin has some downsides, so does fiat money. I am only a grain of sand on the beach, and I and others have done well with crytos including bitcoin, only thing I can try to persuade you is if you had about $4K to try a run at crypto mining in June of 2017, you have broken even with $4K in coins, your hardware is paid off, you can continue to mine as it is still quite profitable, or you can now sell the hardware for a good $2K at least and walk away maybe being even wealthier in a few years when the coins increase in value.

Some people have spent $100K in ethereum for cryptokitties digital cats http://kittysales.herokuapp.com/, so sure it may sound far out except why question it, use it in your way and be happy, it's at least a shot for lots of people forgotten by the systems of the world to make a living instead of counting on uncle Sam to take care of them their whole life.
 
RogueTadhg said:
Those with mass quantities of BTC holding do wonder when they're going to start unloading their coins.
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Everyone needs to quit thinking like this. The purpose of a new currency isnt to convert it to another currency. Nobody is running around with USD waiting for the moment to drop it for Euros. You keep your USB because it is your currency of choice and allows you to buy things easily in this country. Thats the aim of cryptocurrency. It's a NEW currency, so keep it until you can do something useful with it.
 
Bulgarian police just got a few B$ worth in seized bitcoin from criminals. They alone can plummet the market if there are no buyers
 
nysmo said:
Everyone needs to quit thinking like this. The purpose of a new currency isnt to convert it to another currency. Nobody is running around with USD waiting for the moment to drop it for Euros. You keep your USB because it is your currency of choice and allows you to buy things easily in this country. Thats the aim of cryptocurrency. It's a NEW currency, so keep it until you can do something useful with it.
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You can't really use one currency in another land that doesn't accept it. You can get me millions of Euros, but it's worthless until I can convert it to USD for the US soil. I've tried living off Bitcoin where I live. It's still not accepted enough.

Actually people do purchase one form of currency and convert it over to another currency - Forex trading. People who take advantage of the difference of worth at one time or another. Buy low, Sell high. Sell High, buy low.

tetris42 said:
Is it on talk radio now or something?
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I'm sure it's been on talk radio shows.
 
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DPI said:
Boom.

Whole lot of missed-boat anger shows up every time the word Bitcoin appears in a thread title.

I swear it's like a batsignal for dumb and angry. Every time.
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Except that there is one thing that bitcoin zealots refuse to acknowledge.

Do you really think that world governments are going to let a deregulated cryto currency take power away from them? As soon as it is a threat it will be heavily regulated or outright banned by governments. They aren't going to sit idle and let control of their fiat go away. Once this happens then bitcoin (or any crypto) will have lost its appeal.

The IRS is already sniffing around.
 
DUmb question. Is bitcoin going up in price due to people wanting to buy them with fiat currency, or is it because people are mining alt coins and using them to buy bitcoins? It seems odd that the market cap increases this fast using just cash.
 
I'd like a happy Meal please. "Ok that's $5 for the meal plus $25 processing fee. Please go sit in a booth over there while the transaction is completed. Should only take a few days".
 
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