I happened upon a study that I found quite compelling. A crypto magazine called CoinKickoff put together a list of cryptocurrencies by the number of whales they have and, more importantly, the percentage of total supply said whales own.
This is a huge red flag to me.
Whenever I see that a small number of people control a chunk of the total that’s too large. I run the other way.
It’s no coincidence that, aside from cryptos you’ve probably never heard of, all exchange-related tokens are among the worst-performing ones in that sense.
Seven people control 91.72% of the entire supply of FTT Token, five people control 91.49% of CRO, and the same number of people control 86.93% of NEXO. Huobi does even worse in terms of percentage, with eight people controlling 96.19% of HT supply.
Similar numbers apply to GUSD and BUSD but that’s a different story, since these are technically stablecoins.
OKB, OKX echange’s native token, scores amazingly low with just 19.04%. However, we should point that that percentage is made up by only two people.
If we’re considering well-known, large cap ones, Axie Infinity does pretty bad with six people owning 94.88% of the supply. I have some AXS and I’m honestly considering selling it after finding this out because it’s crazy.
Sandbox (10 whales, 78.98%), Matic (13 whales, 71.17%) and Shiba Inu (15 whales, 68.87%) aren’t doing too well either.
ETH is at 22.25%, LTC does even better with 13.45%. In both cases, we’re talking about six whales.
Bitcoin is obviously the odd one-out. It has many whales but the only one with significant influence (1.15%) is Satoshi.
Whales are inevitable and I don’t mind if a small number of people control a large number of coins. I can just about live with the fact that six people own $800 million worth of LTC, one of my favourite cryptos.
But when we get to the 60 or 70 or even 80%? That’s crazy. That’s a level of centralisation even big banks and governments dream of.
And that’s the exact opposite of why we’re here, in crypto.
This article was crossposted on Publish0x.
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