File image: Cryptocurrency, bitcoin. (Reuters).
File image: Cryptocurrency, bitcoin. (Reuters).

40% of Bitcoin 'owned by 1000 people'

By Staff Reporter Time of article published Dec 21, 2017

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CAPE TOWN - Forty percent of digital cryptocurrency, Bitcoin is owned by 1 000 people, this averages to about R1.3 billion per person, reports Business Insider. 

This comes after the data was cited by global investment firm, AQR Capital Management.  

Read also: Bitcoin’s mysterious creator may become the first trillionaire

Given that the cryptocurrency is owned by a handful of investors, these owners reportedly have a strong influence on the bitcoin prices. 

This places bitcoin investors in a lucky pool. However, newer bitcoin investors are cautioned to evaluate the currency before investing in it. 

This is because the majority investors have outsized the ability to influence bitcoin prices. 

This makes it even more risky, considering that bitcoin’s value is not based on an underlying asset. Rather, it is based on human sentiment. 

Meanwhile, bitcoin founder who is known by the pseudonym, Satoshi Nakamoto is currently the 52nd richest person in the world, according to Forbes list of billionaires. 

Further predictions reveal that the 52nd richest person in the world is on his way to topping the list as the world’s first trillionaire.

Nakamoto is believed to be in possession of around 1 million Bitcoins. Given the current value of the cryptocurrency, this makes him R223 billion rich.

Despite this great success, Japanese Finance Minister, Taro Aso on Tuesday cautioned individuals about the cryptocurrency. 

Aso said that bitcoin has not been proven to be a credible currency and that he would watch its developments in the near-term.

“There’s no fixed definition on whether it’s a currency or not. This issue is a difficult one,” Aso said after a cabinet meeting.

“It has not yet been proven to be credible enough to become a currency, so I need to watch for a little while more.”

He added virtual currencies may be widely used in countries such as China but that they were less common in Japan, where hard currency is still preferred.

What complicates the cryptocurrency further is that large investors do not have to disclose their bitcoin ownership. This further complicates the credibility of bitcoin. 

However, the cryptocurrency surged from 2011 where it was worth a mere one dollar (R13). Two years later, in 2013, the value had risen to a modest R2625. This kind of growth is unheard of, even for digital giants like Apple, Google and Facebook.

Although the growth in the price of Bitcoin is not going to last forever, at this moment, it seems promising. 

READ ALSO: Bitcoin is not proven to be a credible currency - Japan


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