The 'Bitcoin Rich List' Has Grown 30% in the Last Year, But Why?

The Bitcoin Rich List, or the number of addresses holding more than 1,000 BTC, has swelled in the past 12 months, possibly reflecting an influx of high-net-worth investors.

At press time, 2,148 addresses contain more than 1,000 bitcoins, amounting to just 0.01 percent of all bitcoin addresses, as per BitInfoCharts' Bitcoin Rich List.

"The two options are we have high-net-worth investors coming in or it could be cold storage practice at the exchanges and custody solutions. The latter explanation cannot be ruled out, but it does not coincide with other data we have on the timing of when supply increased at these entities. For now, I'm going with the first explanation."

A cryptocurrency exchange like Binance holds bitcoins belonging to millions of users and can store coins in different wallets.

"It's mostly the exchanges both the amount of BTC held in exchanges and the number of exchanges/custodians have been growing," trader Alex Kruger told CoinDesk.

Top addresses have fewer withdrawals compared to deposits and could be exchanges' cold, or offline wallets.

While trading volume is the lifeblood of exchanges, it is not necessarily reflected on-chain, since these companies may internally debit or credit client addresses without executing a transaction on the public ledger.

Further, as shown in the chart below, if you take out known exchange addresses, the rich list still grew by almost 30 percent over the 12-month period, to more than 2,100 addresses, pretty much the same rate as for all addresses.

Trading volumes at the Bakkt bitcoin futures exchange, which needs to store bitcoin for its physically delivered futures, are increasing.

The exchange, a subsidiary of Intercontinental Exchange, is set to launch options on futures on Dec. 8.