When we talk about cryptocurrencies, the question of their distribution and concentration inevitably arises. Is Ethereum’s value evenly distributed, or is it dominated by a few powerful wallets? The answer may be surprising, especially if we look at the latest data on the ten largest Ethereum wallets.
Ethereum, the world’s second-largest cryptocurrency, has always attracted the interest of investors and analysts. But how exactly is its wealth distributed? A study conducted by the analytics firm Santiment reveals fascinating data about the ten largest Ethereum wallets.
Five years ago, these powerful wallets controlled only 11.2% of the total available Ethereum pool. Today it’s as much as 34.6%, which translates to an impressive sum of 27.86 million ETH, or about 51.6 billion dollars. This means that over the past five years, the concentration of funds has significantly increased among these top players.
However, what’s really fascinating is the fact that a significant part of this growth took place in just the last year. These addresses acquired an additional 11% of the total available Ethereum pool.
Compared to other cryptocurrencies, the IntoTheBlock platform showed how wealth distribution varies between Bitcoin, Dogecoin, and Ethereum. For Bitcoin, about 80% of the available supply is held by only 0.32% of all addresses. Whereas for Ethereum and Dogecoin, a similar percentage of the supply is controlled by only 0.01% and 0.014% of all addresses respectively.
Although Bitcoin seems more decentralized compared to Ethereum, the concentration of wealth in a few addresses is not desirable for market stability. Holding a large amount of cryptocurrency in few hands can lead to significant price volatility if these major holders decide to move their funds.
The final reflection concerns the overall health and stability of the cryptocurrency ecosystem. As the market matures, it’s crucial for investors to be aware of where and how capital is concentrated. Only then can one accurately assess risk and potential benefits.
While cryptocurrencies attract investors with the promise of decentralization and democratization of finance, these data show that in reality, there are still significant disparities in wealth distribution. Does this mean that cryptocurrencies are repeating the mistakes of the traditional financial system, or is this just a temporary deviation on the path to a more equal and decentralized financial world? Only time will tell.
