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Retail holds 14% of supply
One of the most common Fear, Uncertainty, and Doubt (FUD) criticisms of Bitcoin is that the majority of the supply is heavily concentrated in the hands of a few. As with any financial system or asset class in existence today, this type of allocation is true, but in the case of Bitcoin it is almost always an exaggeration.
Bitcoin’s share of supply held by esteemed retailers is taking a larger share of the network every year. It’s one of the few assets in the world that anyone with an internet connection and a smartphone can get, and has an incredibly low level of adoption by the common man.
Many critics cite an address chart like this and call it truth. The truth is that tracking supply distributions across addresses is incredibly nuanced, and this is a key reason why Glassnode used a set of heuristics and clustering algorithms to estimate entities on the network rather than addresses.
What Glassnode found in its analysis a year ago is this:
“We can deduce that about 2% of network entities control 71.5% of all bitcoin. Note that this number differs significantly from the often touted “2% control 95% of supply.”
And that 71.5% was an upper limit, ie a high estimate of the supply distribution concentration. There are many reasons why the retail portion is likely larger due to bitcoin having custodians, supply of exchanges, lost coins, and a conservative method of identifying businesses.
Looking at corporate distribution data today, we find a clear trend that retail (companies holding less than 10 BTC) increased their share of the circulating supply from 1.51% in 2012 to an average of 13.90% in 2022 elevated. Most of the supply growth comes from companies holding 1-10 BTC and 0.1-1 BTC.
The data helps ensure Bitcoin is money destined for and accessible to the shared global individual. Although institutions and institutional capital flowing into the network is likely the next big price catalyst and will impact supply share, we continue to see retail network share increasing as anyone in the world can own and store Bitcoin.
It was a unique case study where retailers and individuals are exceptionally able to access assets and economic wealth before institutions.