Cryptocurrencies such as Bitcoin are predicted to trigger the democratization of finance and facilitate access to digital payments in society. But this new research indicates otherwise.
The National Bureau of Economic Research research published in the Wall Street Journal was written by academics from MIT and the London School of Economics. It was revealed that the gap in Bitcoin turned out to be a big problem.
As quoted by us from Gizmodo, Wednesday (12/22/2021) it was revealed that of the 19 million Bitcoins currently in circulation, as many as 0.01% of buyers control 27% of the total supply.
The figure of 27% owned by 0.01% is equivalent to about 5 million Bitcoins with a value in the range of USD 232 billion. Compared to the richest 1% of people in the United States, 'only' controls a third of the wealth in the country.
In their research, these researchers mapped and analyzed every Bitcoin transaction during its 13 years of existence. It's not clear who will benefit the most from Bitcoin, but the gap has the potential to widen.
The reason is, if the value of Bitcoin goes up, then those who control it will get richer. Not to mention at this time, Bitcoin mining is increasingly expensive.
Earlier in an interview with CNBC, Eswar Prasad, a professor of economics at Cornell University, stated that cryptocurrencies may make digital payments more accessible, but that does not guarantee that it will reduce inequality.
"Due to inequalities in digital access and financial literacy, cryptocurrencies may end up exacerbating inequality," he said.
"In particular, any financial risks that may arise from investing into cryptocurrencies and related products may have a severe impact especially on naive retail investors," he added.