More than 30% of mined BTC is inactive, and exchanges are the largest HODLers

As we all know, the total supply of Bitcoin is capped at 21 million. Its block reward is halved every four years, which means that the supply is halved every year, thereby achieving the effect of controlling inflation and avoiding artificial manipulation. However, with a stable supply, how many Bitcoins have been mined? Are all mined Bitcoins active?

Image source: pixabay

The answer to the first question is simple. Just over 18.29 million bitcoins have been mined, which is over 87% of the total supply, leaving about 2.7 million unmined. Bitcoin miners mine about 144 blocks a day, each containing 12.5 bitcoins, or 1,800 bitcoins per day, and soon, by May, that number will drop by half.

Now, let’s move on to the second question, are all mined Bitcoins active? Well, while the first question tells us that 18.29 million Bitcoins have been mined, that doesn’t mean that they are active and in circulation.

According to data released by Unchained Capital on April 1, 2020, the HODL Wave Index, which tracks unspent transaction outputs (UTXO) of Bitcoin in the past 2-3 years, has dropped below 15% to 14.98%, which means that about 15% of the mined Bitcoins have been idle for 2-3 years.

This 15% is equivalent to 2.74 million bitcoins. If calculated based on the market price of approximately US$6,600 at the time of publication, the total value is US$18.08 billion.

Looking at a shorter time frame, 5.36% of bitcoin has not moved in 18 to 24 months, 10.73% has not moved in 12 to 18 months, and 13.96% has not moved in 6 to 12 months, according to Unchained Capital.

With almost one-sixth of all Bitcoins in circulation sitting there untouched for such a long time, where are they stored? While Bitcoin addresses are the organic storage location for BTC, exchanges have accounted for a large portion of the total in the past few years.

Since the crypto market bull run and subsequent winter in 2017, many exchanges have been established, their services have expanded, and the number of Bitcoin HODLers has grown accordingly, with some crypto analysts calling exchanges the "biggest HODLers."

Bitcoin price and exchange wallet balance chart | Source: TokenAnalyst

So how much Bitcoin are being hoarded by exchanges? The answer is roughly the same as the amount of idle Bitcoin.

CoinShares CEO Ryan Radloff described the number of Bitcoins on large exchanges in a blog post. According to his assessment, Coinbase is the largest "HODLer" with 856,000 Bitcoins stored, and other HODLer exchanges include Binance, Bittrex, Bitfinex, Bitstamp, Huobi, Kraken and BitMEX.

Exchanges and other “intermediaries” (including Grayscale’s Bitcoin Trust and BitMEX’s Insurance Fund) hold 16.6% of the total.

Therefore, from the overall perspective, only a portion of Bitcoin is actually in circulation. 87% of Bitcoin has been mined, 15% of which have been idle for 2-3 years, and 16% of Bitcoin is stored in exchanges for a long time.

Link to this article: https://www.8btc.com/article/577735
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