Ethereum Whales Hold 32.3% of Supply, Highest Since 2016
Recent data from on-chain analytics firm Santiment reveals that Ethereum wallets with at least 1 million ETH now control approximately 32.3% of the total circulating supply, the highest level since July 2016. These large investors, often referred to as whales, have been increasing their holdings in recent months.
Understanding Supply Distribution
Santiment’s “Supply Distribution” metric tracks the percentage of Ethereum supply held by different investor groups. Wallets are categorized based on the number of coins they hold. The focus here is on addresses holding 1 million or more ETH, which is currently valued at nearly $1.6 billion.
Influence and Concerns
Given their massive holdings, these billionaire-sized wallets are highly influential in the market. However, this concentration of wealth raises concerns about asset centralization. Decentralization is crucial in cryptocurrencies like Ethereum that use a Proof-of-Stake consensus mechanism. Ideally, no single entity should control a significant portion of the total supply.
Potential Implications
While these whales do not currently hold enough supply to control the network, the level of centralization is still worth monitoring. On a positive note, the total number of Ethereum wallets with a balance has surpassed 100 million, indicating growing adoption of the asset.
Current ETH Price
The price of Ethereum is currently trading around $1,580 after experiencing a slight recovery from its recent low of $1,550.
Hot Take: Ethereum Whales and Centralization Concerns
The increasing concentration of Ethereum supply among billionaire-sized wallets raises questions about centralization in the network. While these whales currently do not have enough control to manipulate the market significantly, it is essential to ensure that no single entity holds a disproportionate amount of the total supply. This issue is particularly significant for Ethereum’s Proof-of-Stake consensus mechanism. However, the milestone of over 100 million Ethereum wallets with a balance indicates growing adoption and interest in the cryptocurrency.
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