Excerpt
I explain why Bitcoin’s value comes from scarcity, not from how wealth is distributed among wallets. While some argue that Bitcoin is too concentrated, the reality is more nuanced – exchanges hold coins for millions of users, and lost coins only increase scarcity. Watch the full video to understand the truth about Bitcoin’s wealth distribution and scarcity.
Transcript
The less coins that are on the market, the higher the price. Like when the demand is high and the supply is low, the price of Bitcoin goes up. But I don’t feel, it doesn’t matter who holds the coins, you know? It’s true. There are many, many wallets or maybe even addresses. Like one address doesn’t mean one wallet. In a wallet, there are thousands of addresses. So even when we say there are only a small number of wallets around, most of them are institutional wallets. They are wallets of exchanges. They have the funds of a lot of individuals. So you can’t really say it’s totally concentrated in these wallets because there are a lot of owners or people who own the funds in these wallets. So in general, yes, the wealth distribution, sadly at the moment, follows a little bit the traditional finance because it’s a fact that people who already have money are able to acquire more Bitcoin. So that’s true. But the calculation and always this only a small number of people own Bitcoin because there are just a certain small number of wallets. And that’s why the wealth distribution in Bitcoin is totally concentrated in the hand of a few. That’s wrong in my opinion. But of course, we would like to see more wealth distribution in Bitcoin in more hands of individuals, especially in the global south. So that’s why we are all doing this work, you know? And there are lost coins, mostly also those who are attributed to belong to Satoshi, like the first coins that were mined at the beginning, they are not available for selling. And that scarcity even increases the natural scarcity of Bitcoin. But I just wanted to add that, that I don’t believe that the wealth distribution has an effect on the scarcity because it doesn’t matter if many people or not so many people hold the Bitcoin. It’s the same scarcity.
