If you're ruing the decision not to dip your toes into the cryptocurrency market, and feel like you are one of the few that missed out, don't worry, you're not. Even with the recent plunge inprices, bitcoin and other cryptocurrency prices remain well above historical levels.The New York Times published an article over the weekend titled Everyone is Getting Hilariously Rich And You're Notwhere a bunch of white dudes dressed like they pioneered theWilliamsburg hipster movementtold their stories of cryptocurrency success, leaving casual readers to wonder, why not me?
However, despite the media frenzy,distribution data suggest you arenot alone if you don't own bitcoin, and if you do, you are certainly not getting rich. While millions read aboutsurging cryptocurrency pricesandgrowing market caps, the number of actual wallets widening is just a handful. (See also:The 6 Most Important Cryptocurrencies Other Than Bitcoin)
According to bitinfo, which tracks the total number and value of bitcoin addresses, 75% of addresses are home to less than 0.01 bitcoin, and 97.54%have a balance of less than onebitcoin.So at its current price of $10,100, three-quarters of bitcoin addresses are worth just over $100. And at the other end of the scale, the number of addresses with balances between 100,000 and 1,000,000 is three, or 0.0000106%. And in monetary terms, the bitcoin millionaire buzz is more a fuzz. Just 0.07% percent of addresses are worth more than $1 million whereas 74.5% of addresses are worth less than $1.
So when Erik Finman, the 18-year old school drop-out told CNBChe became amillionaire by investing money from his grandma into bitcoin, there's no need to feel foolish. Erik is one of afew bitcoin millionaires.
Howit compares to U.S. stocks?
If bitcoin isn't making you rich, then the record stock market pricesmust be right? Again, not really the case. While concentration of wealth in U.S. stocks is nothing compared tocryptocurrency markets, the shrinking number of people benefiting from the bull marketpaints a pretty clear picture of the overall asset concentration in the U.S.
On January 16, the Dow Jones Industrial Average topped 26,000 for the first time, just 12 days since it surpassed25,000. However, the decade-long bull rally is makingfewer Americans wealthy. According to New York University professor, just 13.9% of Americans directly own stocks, and the bottom 60% of U.S. households own just 1.8% of stocks. And much like bitcoin, ownership is highly concentrated with the top 1% owning more than 40% of stocks.
The Bottom Line
After a fruitful2017wherethe price of bitcoin rose from below$1,000 to nearly $20,000, prices have steadied to trade in the $10,000 to $15,000 range to start 2018. However, reddit threads and chat rooms remain clustered with enthusiasts. But don't be fooled, there are only 166,853 addresses worth more than $100,000.
In other words, 0.05% of Americans have slightly less than the average U.S. household income in bitcoin.Minus tax. Minus transaction costs. And with the recent slide in the price of bitcoin this small section of society may become less well-off.
Investing in cryptocurrencies and other Initial Coin Offerings (“ICOs”) is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or other ICOs. Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author does not owncryptocurrency.
FAQs
The price of Bitcoin is volatile, ranging from under $10 in 2010 to a high of $75,830 in March 2024. Most top Bitcoin billionaires became rich by creating products and services to grow the cryptocurrency ecosystem. This overall price increase has also created millions for people who bought and held their bitcoins.
How many people have become millionaires off of Bitcoin? ›
Key Takeaways. There are 88,200 crypto millionaires worldwide. 40,500 of these millionaires have amassed their fortune in Bitcoin (BTC).
How much Bitcoin do I need to be a millionaire? ›
So, 10 times from those levels would mean that Bitcoin could go as high as $350,000, Saylor said. If this is the case, you would need to own 2.86 BTC to become a millionaire. It would cost around $190,000 today.
Are billionaires buying Bitcoin? ›
Any talk of billionaires buying Bitcoin has to start with Michael Saylor, executive chairman and co-founder of MicroStrategy (MSTR -4.90%). The billionaire started aggressively buying Bitcoin back in mid-2020, and has been continually ramping up his company's Bitcoin holdings since then.
What if I invested $1000 in Bitcoin in 2010? ›
That investment would be worth $6,859,178,076.22 today based on the same price of $28,122.63 at the time of writing. While investing in Bitcoin today may never be worth billions of dollars in the future, the hypothetical investment illustrates the large increase in value of the leading cryptocurrency over time.
How much will I get if I put $1 dollar in Bitcoin? ›
Should I buy Bitcoin right now? ›
Unfortunately, it's also incredibly volatile. For that reason, while current market conditions are favorable for anyone considering buying Bitcoin, it is an asset you should purchase only at your own risk. Because while Bitcoin may have the potential for significant returns, you may also lose most of your investment.
Who is the richest Bitcoin owner? ›
For the third year running, Changpeng Zhao, founder and former CEO of crypto exchange Binance, is crypto's wealthiest person.
Is Bitcoin a good investment? ›
Edelman stresses that bitcoin is highly speculative, with a history of volatility, but he believes its potential makes it appropriate for a long-term portfolio, provided that investors limit it to 1% to 5%. "The risks are high, and if it fails, a low single-digit allocation won't cause material harm," he said.
Can you make a living on Bitcoin? ›
It's technically possible to make money by buying and selling Bitcoin within short windows, moving in and out of positions as the market changes. But similar to day trading with stocks, it's far more likely you will lose money this way.
Here are five ways you can cash out your crypto or Bitcoin.
- Use an exchange to sell crypto. ...
- Use your broker to sell crypto. ...
- Go with a peer-to-peer trade. ...
- Cash out at a Bitcoin ATM. ...
- Trade one crypto for another and then cash out.
Common investment advice states that anywhere from 1% - 5% is a safe allocation when considering an investment with higher risk. And as a market with marked volatility, crypto certainly carries a level of risk. While 1% - 5% invested in crypto may not seem like a lot, it has the potential to build over time.
Does Bitcoin have any future? ›
Bitcoin the Cryptocurrency
In 2024, the majority of bitcoins are still out in the wild, so to speak—but over time, and if they continue to be treated as a speculative investment and store of value, these large entities will likely keep growing their holdings.
How does Bitcoin make money? ›
How Does Bitcoin Make Money? Miners on the Bitcoin network can be rewarded by successfully opening blocks. Bitcoins are exchangeable for fiat currency via cryptocurrency exchanges. Investors and speculators can make money from trading bitcoins.
Which government has the most Bitcoin? ›
The U.S. government is one of the world's biggest holders of bitcoin, but unlike other crypto whales, it doesn't care if the digital currency goes up or down in value.
Can you be a millionaire from Bitcoin? ›
Over a long enough period of time, even a relatively small upfront investment could turn into $1 million or more. And, indeed, according to Henley & Partners' Crypto Wealth Report, there are more than 40,000 Bitcoin millionaires in the world right now.
What happens if you invest $100 in Bitcoin today? ›
Investing $100 in Bitcoin: A $100 investment in Bitcoin today could buy 0.00239 BTC, based on a current price of $41,810.58 at the time of writing. Bitcoin hit an all-time high of $68,789.63 in November 2021.
Can you make $100 a day with crypto? ›
You can make $100 a day trading crypto by trading —
Each of these has its own advantages and disadvantages. Spot markets offer the least amount of risk as you only stand to lose the percentage the market moves at.
What would 5000 in Bitcoin be worth today? ›
The current price of 5000 Bitcoin in US Dollar is 333.11M USD. The price is calculated based on rates on 34 exchanges and is continuously updated every few seconds.
