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How many individuals own at least 1 BTC?

I was asked this question today at Quora, a popular Q&A blog covering a variety of technical and economic disciplines. Under my alias “Ellery”, I am the most viewed author on Bitcoin and the blockchain.

While this question may sound like a good factoid for a trivia game, it is directly related to something with with far reaching impact on your pocketbook and your future. It goes to the heart of a debate between warring factions: In the 2nd half of this answer, I address the eternal question:

Is Bitcoin a pyramid scheme? Or are we still early on the adoption curve?

But let’s start with the question at hand…

There is no certain answer to the number of people who own Bitcoin or how many own more than 1 BTC. We know that tens of millions of wallets have been created, but this certainly doesn’t help. Although the value of every single wallet is publicly disclosed on the blockchain (most have a zero balance), there is no way to determine who owns each wallet. Some may be controlled by organizations or custodians on behalf of many individuals, while others may be just one of many wallets with a single owner.

Most of my Bitcoin is in a wallet or a vault hosted by Coinbase, the San Francisco exchange. When I log into my account to view my wallet ID, I see that I have dozens of wallets—all valid. The large number of wallets is not related to my wealth. Rather, it a byproduct of my many small transactions. Coinbase creates a new wallet each time that I buy, sell, or purchase something with my BTC. There are good reasons for this practice, but it certainly muddies the correlation between wallets and number of owners.

There are 16.6 million coins in circulation today (a bit less, since some have been irretrievably lost). That puts a cap answering the question. There cannot be more than this many people with a full BTC—currently worth about USD $5900.

But, we know that the number of individuals with a full coin is considerably less. After all, many people in my own circles own dozens of coins, and Satoshi is very likely to hold 1 million BTC. Coinbase and Bitstamp are just two of very many custodial exchanges (i.e. they offer a cloud wallet or vault service to their clients). They host many hundreds of wallets with more than 50 coins. In almost each case, the client has provided single-user taxpayer information to these services, and so it is very unlikely that a significant fraction of these wallets belong to more than a single person or family.

And, let’s not forget that a far greater fraction of exchanges fly under the covers. That is, they don’t collect taxpayer information or report the wallets that they administer to any authority—nor to analysts or journalists like me.

So, while no one can accurately estimate the number of individuals who own 1 or more BTC, the answer is very likely under 2.5 million, worldwide. 1

The number of people who have heard of Bitcoin is growing rapidly. In the United States, fewer than one in twenty people were aware of Bitcoin just 2½ years ago (at the beginning of 2015). By September 2017, almost one in four USA adults a reasonable idea what it is—and most of them could debate their position on its future. 2

There will never be more than 21 million bitcoin. This is the mathematical upper limit. Compare this with the current US population of 323 million. So even if all Bitcoin owners were in America (they are not!) and if no one owned more than 1 BTC, fewer than 1 in 19 Americans could own a full Bitcoin today and fewer than 1 in 15 after all bitcoin are mined.

If we consider the global population of 7.6 billion, fewer than 1 in 458 people could own a full Bitcoin today. Since most early adopters have more than 1 BTC, the actual fraction is probably much smaller than 1 in 25,000 individuals.

In the introduction, above, I said that the question about how many people own more than 1 BTC leads to a more profound question. In fact, this innocent trivia question, leads to insight about adoption and the economics of investing in a deflationary instrument as it spreads throughout commerce, investors and all sorts of institutions.

Moral of the story…

The original question asks for a simple number. It doesn’t ask for editorial perspective. But it’s tough to resist. With fewer than 1 in 25 thousand people owning a bitcoin, a reasonable question is:

Will adoption increase, even if interest is limited to only one sector?

For example, what if Bitcoin falters in all but one of these venues: Bleeding edge geeks, collectors, investors, p2p payments, interbank transfer, debt settlement, or treatment in some regions as a currency.

Answer: Even if Bitcoin continues to show strength in just one of these areas, it will eventually be used or accumulated by millions of new users—even if they don’t realize it!

Do you see where I am going with this? Even if you believe that Bitcoin will…

  • never be treated as a store of value (this is nonsense of course),
  • only be used on one continent (nonsense, again),
  • never erode payment & settlement services such as Visa or PayPal (it already has),
  • that governments can successfully block payments or deter growth (they cannot—and they are gradually realizing that it does not interfere with taxing or spending or sovereignty),
  • that another digital coin will overtake Bitcoin (it cannot—the reasons are subtle, but they are well understood)…

Even if you believe in all of these limiting factors, the overall demand for Bitcoin has barely begun. We have not even started climbing the hockey-stick curve toward limited adoption as an occasional, alternative payment mechanism.

At conferences and in my own classroom, I am often asked: Should I still acquire Bitcoin? —Or is it too late? After all, it has risen from a fraction of a penny to $6,000 in just a 7 years. And from under $1000 to $6,000 this year alone!

I am not a financial advisor. I often speculate, but never offer guidance. I embrace the wisdom that past performance is never an assurance of future gains. But, I ask students to look at the assumptions and at the math: Unlike US dollars, shares in Apple, pork bellies or gold pressed latinum, Bitcoin is firmly capped. There will never be more than a paltry 21 million coins. That means that each coin absolutely, positively must increase in value with even a modest adoption scenario.

The Argument Against Bitcoin

Bitcoin is a pure supply-demand commodity. Since the supply is fixed and well understood, the only argument against acquiring Bitcoin arises from a belief that demand will dwindle. This is the argument of someone who believes that Bitcoin will fail to gain any further traction in any sector.

Perhaps you believe that something else will displace it, or that governments will find a way to effectively defeat it. If you have been reading my Blog (or my Quora answers) for more than a few months, then you already know that neither scenario is realistic.

I believe that investment in Bitcoin a speculative asset retards adoption. I defend this opinion in many interviews and articles. Although I hope for fewer speculators and more ‘legitimate’ users, I own an outsize share of the world’s future value store, transfer media and fungible, liquid asset. I am guilty of the speculation that I seek to deter.

1 & 2 CRYPSA Research, Feb 2015 and Oct 2017, Cryptocurrency Standards Association. Polls conducted at Rein’s New York Deli in Vernon CT and Spectrum Center, Irvine CA.

Philip Raymond co-chairs CRYPSA, publishes Wild Duck and hosts the New York Bitcoin Event. He is on the New Money Systems board and kicks off Cryptocurrency Expo in Dubai. He frequently consults and presents.

Sending satellites into space is going to continue to get cheaper since SpaceX proved it could reliably launch refurbished rockets. This is going to open up space exploration to more entities allowing for the continued democratization of space. Other technological advances could make a global space centered sharing economy a real possibility.

The rise of the internet and the ubiquity of mobile computing devices have changed everything from travel and shopping to politics – think Uber, Amazon, and Twitter.

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The Google, Apple and Facebook workers who helped make technology so addictive are disconnecting themselves from the internet. Paul Lewis reports on the Silicon Valley refuseniks who worry the race for human attention has created a world of perpetual distraction that could ultimately end in disaster.

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Last year, we reported that Microsoft and Facebook were teaming up to build a massive undersea cable that would cross the Atlantic, connecting Virginia Beach to the northern city of Bilbao in Spain. Last week, Microsoft announced that the cable, called Marea, is complete.

Marea, which means “tide” in Spanish, lies over 17,000 feet below the Atlantic Ocean’s surface and is around 4,000 miles long. It weighs 10.25 million pounds. The data rates (which let’s face it, that’s what we’re all really interested in) are equally staggering: Marea can transmit at a rate of 160 terabits/second. And it was finished in less than two years.

What’s really interesting about Marea, though, is that it has an open design. This means that Microsoft and Facebook are trying to make the cable as future proof as possible. It can evolve as technology changes and demands increase for more data and higher speeds. Its flexibility means that upgrading the cable and its equipment to be compatible with newer technology will be easier.

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I did a new interview on #transhumanism for some journalism students at Germany’s Technical University of Dortmund. It’s in English:

Mechanical bodyparts are very common nowadays – a lot of humans have a hip replacement or a pacemaker. Technology helps saving our lives rather often. Some people want to take this a lot further – a philosophical and scientific movement called Transhumanism. Zoltan Istvan Gyurko is one of the most famous Transhumanists, he even ran for president in 2016. In this interview, he talks about his first experiences with Transhumanism, immortality and the future of humanity.

By Marie-Louise Timcke und Paul Klur

Why is Transhumanism important for our society nowadays?

Zoltan Istvan: Well, Transhumanism is perhaps the most important subject matter that we have actually existing in society at the moment. Because humankind has been moving forward very slowly developing science and technology. But in ways that haven’t really rudimentary changed the human being. But all of a sudden, since the invention of the microchip, humanity is changing dramatically because of data, because of the internet, because of computers, because of smartphones. And what we have seen is almost nothing compared to what we’re going to see over the next ten or twenty years. Transhumanism is the field that wants to use science and technology to modify the human being and realise this kind of digitization of the actual self. But most importantly, the next ten years are going to be completely disruptive to whatever we thought it meant to be human beings.

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https://youtube.com/watch?v=RxwZClHWekQ

Researchers from Wits University have linked a brain directly to the internet. Data gathered from this project could help fuel the next steps in machine learning and brain-computer interfaces.

A team of researchers at Wits University in Johannesburg, South Africa have made a major breakthrough in the field of biomedical engineering. According to a release published on Medical Express, for the first time ever, researchers have devised a way of connecting the human brain to the internet in real time. It’s been dubbed the “Brainternet” project, and it essentially turns the brain “…into an Internet of Things (IoT) node on the World Wide Web.”

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When one thinks of Mark Twain, one thinks of folksy wit, Huckleberry Finn, Tom Sawyer and the Mississippi River. Twain’s work immortalized the rapidly changing United States of the 1800s. But in his personal life, Twain often preferred the future to nostalgia, supporting women’s suffrage and civil rights, and frequently being contemptuous of what he considered to be the absurd and corrupt values of the past. He harbored a long running fascination with technology and new gadgets, and frequently invested in the latter — albeit with spotty success, at best. But Twain cemented his becoming an honorary futurist via his long friendship with inventor and Mad-scientist archetype Nikola Tesla.

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NEWPORT BEACH, Calif., July 12, 2017 /PRNewswire/ — Strathspey Crown LLC, a lifestyle healthcare company focused in ophthalmology, medical aesthetic and elective technologies and procedures, today announced that the United States Patent and Trademark Office has issued U.S. Patent No. 9,662,199 covering an implantable intraocular lens with an optic (including accommodating, multifocal and phakic configurations), a camera and an LED display, and a communications module that wirelessly transmit and receive information from an external device (e.g. PDA).

Robert Edward Grant, Founder and Chairman of Strathspey Crown LLC commented, “Video cameras are now a standard feature of smart phone technology and wearable cameras have become popularized by companies like Google and Snap in recent years. This patent represents a significant step forward in the rapidly growing sector of human cyborg technology. The eye, as a transparent medium for light, is ideal for advanced and rechargeable implantables that enable video capture of all of life’s experiences. Our broader vision is to develop ground-breaking medical-grade ocular smart implantables that integrate cellular, WIFI and 802.11 transmissions in an elegant cognitive interface that we believe will enhance human intelligence, augment perceived reality, and digitally capture experiences and individual memories. We look forward to several continuations and expansions on this important intellectual property portfolio.”

Grant further commented, “Although Samsung, Sony and Google have all recently filed patent applications related to the same field, Strathspey Crown is thus far the only company to hold an issued patent in this promising ocular smart implant category. Our first camera-integrated acrylic IOLs will be completed in 2018, upon which we plan to pursue an FDA Investigational Device Exemption (IDE) and subsequent Pre-Market Approval (PMA) and related clinical trial.”

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