Historical Concentration

Overview

The Historical Concentration indicator shows the distribution of a crypto-asset’s circulating supply. Assets with high supply concentration will have whales and/or investors controlling most of the volume, while assets with low supply concentration have most of the circulating supply held by retail users. IntoTheBlock classifies these three groups the following way:

Whales: Addresses holding over 1% of a crypto-asset’s circulating supply.

Investors: Addresses holding between 0.1% and 1% of circulating supply.

Retail: Addresses with less than 0.1% of circulating supply.

💡 How can I use it?

The Historical Concentration indicator is useful to monitor changes in the groups holding a crypto-asset and to understand its implications. An increase in whale concentration can show large investments into a crypto-asset, while increase in retail investors’ concentration tends to occur during mania phases.

For example, with Dogecoin we observe that the concentration of whales increased sharply in 2018 during the bear market. This is a sign that a few players bought significant amounts of DOGE, presumably expecting it to grow in value. In this case, it seems that whales’ conviction was accurate as DOGE’s price climbed as much as 22,000% since then.

On the other hand, we observe retail concentration in DOGE climbing strongly after setting a new high in early 2021. This reflects the increased interest casual traders had in the dog-themed coin throughout the year.

Disclaimer. The whales indicator and other ownership indicators do not differentiate regular addresses from exchanges and smart contract addresses. Hence, the indicator provides an approximation of the concentration of ownership but not a fully-detailed one. IntoTheBlock is working on better classifying whales and smart contract addresses.

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