More than 3/4th of NFTs Hosted on Ethereum is Owned by Just 17% of Addresses October 25, 2021 October 25, 2021 Kelly Cromley http://1AZFjzw2#Nwf63pYaMWq#xIY
Market NewsOctober 25, 2021 by Kelly Cromley

More than 3/4th of NFTs Hosted on Ethereum is Owned by Just 17% of Addresses

According to Moonstream, an open-source blockchain analytics tool, a minority of wallets held almost 80% of all non-fungible tokens (NFTs) on the Ethereum blockchain between April 1 and September 25. As per the October 21 study, 17% of wallets possessed four-fifths of NFTs during that time frame. The paper examined records from 7,020,950 million NFT trades on Ethereum over a six-month duration.

It was discovered that whales, NFT platforms, and exchanges controlled a considerable percentage (80.98%) of NFTs on the blockchain, accounting for 16.71% of all wallets. The remainder was divided among the rest 83.29%.

As one Reddit user observed, this tendency appears to match the Pareto Principle or the 80/20 rule. This is a concept that states that 80% of the results are the outcome of 20% of the impacts.

It is worth emphasizing that the study’s content is entirely based on the Ethereum blockchain, rather than Layer 2 networks or centralized Application Programming Interfaces (APIs). This is explained in the report’s ‘Caveats’ segment.

“The Ethereum NFTs database is built entirely from Ethereum blockchain activities. It excludes content from Layer 2 networks such as Polygon. It also excludes content from centralized APIs such as the OpenSea API. It does not take into consideration any non-ERC721 smart contracts linked with these platforms on the Ethereum network. This implies that two parties may swap a positive quantity of dollars for a transfer off-chain and then execute the transfer on-chain, and we wouldn’t be able to tell the difference between a transfer and a gift. A single transaction may also comprise numerous NFT transfers.”

While the disparity in NFT distribution is clear, Moonstream maintains that small investors may still participate.

“This data suggests that the Ethereum NFT market is open in the notion that the great majority of its players are small-time buyers who most likely conduct their purchases physically. There are minimal entrance hurdles for people who want to join in this sector.”

Contrary to popular belief, obtaining and holding NFTs is quite simple. Individuals may fund their wallets on an NFT marketplace. Following that, customers will be able to quickly bid on accessible NFTs. OpenSea, Rarible, and Foundation are three major NFT markets.

AuthorKelly Cromley

Kelly is our in house crytpto researcher, delving into the stories which matter from blockchains being used in the real world to new ico coming out.