The Most Urgent and Important Game of Musical Chairs

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Getting into some numbers helps frame up the opportunity and the urgency in making an allocation to bitcoin.

Given that the readers of this blog will be relatively affluent, the best analog for the opportunity related to bitcoin is based on global demand. At the most basic level, the are 56.1 million millionaires in the world1, the penultimate total bitcoin supply is capped at 21 million, which will be reached in 2140. Currently 93.7% of all bitcoin have been mined, or approximately 19,700,000. Based on simple math, as at today’s bitcoin issuance, the most bitcoin each millionaire in the world could own would be 0.35 – about a third of a single bitcoin.

Now it is a widely held perspective that many of the early bitcoin mined have been forever lost, no longer accessible with no access to the private keys. Some estimate that up to 3.7 million bitcoin have been lost forever2 and when those lost coins are factored in, the available bitcoin per millionaire in reduced to 0.267, slightly more than a quarter of a bitcoin. This estimate also includes Satoshi’s stack of 1 million bitcoin, that have never moved or transacted. Many believe these bitcoins have been forfeited forever to the bitcoin network.

A further restriction on available bitcoin is those bitcoin that are held in long term storage, by entities or holders that have no intention of ever selling their bitcoin. For this we can refer to the list of corporations, governments and investment vehicles3 which shows that a further 1.48 million bitcoin are held by the long term holders. Resulting in identifiable available supply of approximately 14.3 million or 0.24 bitcoin per millionaire.

To be clear, bitcoin is not for millionaires, it truly is freedom money. Bitcoin is a global asset, there are individuals around the globe building their bitcoin positions in a slow and steady manner, recognizing the unique and important aspects of this asset. These individual holders around the world are doing whatever they can to build up their ownership in un-confiscatable wealth and it is likely they will never sell those coins. To that end, the true available supply is probably what is available and held on bitcoin exchanges, roughly 3 million3 at the time of writing. On this basis, if there was a demand surge these are the coins that could be purchased in relatively short order, representing only 0.05 bitcoin per millionaire.

1 www.investopedia.com/news/number-millionaires-continues-increase/
https://decrypt.co/37171/lost-bitcoin-3-7-million-bitcoin-are-probably-gone-forever3 
3 Bitcointreasuries.net

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