Author: Glassnode
Compiled by: Felix, PANews
Highlights:
- After 5,256 trading days, Bitcoin broke through the $100,000 mark for the first time on December 5, with a market capitalization briefly exceeding $2 trillion.
- Miners have cumulatively earned $71.49 billion, reflecting the security and economic incentives of the Bitcoin network.
- The Bitcoin network has processed 1.12 billion transactions, settling $131.25 trillion in transfer volume, and the adjusted data can more clearly reflect the real economic activity.
- The detailed holdings of different groups show that Bitcoin holders are widely distributed, covering both retail and institutional-scale holders.
This article explores the evolution of the Bitcoin network and its economic foundation, reviewing the journey of Bitcoin from the Genesis Block to the breakthrough of $100,000.
Market Expansion
Bitcoin's trading price has been active for 5,256 days, rising from a few cents to $100,000. This journey includes 72 positive monthly candles (including December 2024) with an average gain of 37.4%, and 71 negative monthly candles with an average decline of -14.2%.
This reflects the wonderful balance between bull and bear markets, as well as the positive skew that occurs during the most important price appreciation periods.
As of December 5, a total of 19,791,952 BTC have been mined, accounting for 94.2% of the total supply of 21 million. Bitcoin's market capitalization also briefly exceeded $2 trillion, surpassing the silver market value (about $1.84 trillion).
During this market expansion period, investors realized $1.27 trillion in profits and $592 billion in on-chain losses (based on the difference between buy and sell prices). This resulted in a net capital inflow (actual market value) of $750 billion, highlighting the enormous value that has flowed into the Bitcoin network over its lifetime.
Supply Distribution
Among the mined Bitcoins, the distribution of different wallet sizes is as follows:
- <0.001 BTC: 5,491 BTC (0.027%)
- 0.001–0.01 BTC: 42,683 BTC (0.216%)
- 0.01–0.1 BTC: 271,641 BTC (1.373%)
- 0.1–1 BTC: 1,077,839 BTC (5.446%)
- 1–10 BTC: 2,093,845 BTC (10.581%)
- 10–100 BTC: 4,306,780 BTC (21.761%)
- 100–1,000 BTC: 4,342,868 BTC (21.935%)
- 1,000–10,000 BTC: 4,693,216 BTC (23.716%)
- 10,000–100,000 BTC: 2,309,654 BTC (11.671%)
- >100,000 BTC: 647,934 BTC (3.274%)
It is worth noting that most whale wallets (holding 1000+ BTC) are related to exchanges, ETFs, and large institutions (such as MicroStrategy). Each of these large entities represents the collective ownership of thousands to millions of clients and shareholders.
Notable holdings include 1.8 million Bitcoins (9.1% of supply) held on exchanges and 1.1 million Bitcoins (5.6% of supply) managed by US ETFs. Additionally, miners (excluding Patoshi) hold 0.7 million Bitcoins (3.5% of supply), while the US Treasury holds 0.187 million Bitcoins (0.9% of supply), reflecting the wide distribution of Bitcoin across various entities and highlighting the increasing institutionalization and centralization of Bitcoin custody. (Note: The earliest independent miners mined a large amount of Bitcoins, and the community believes this miner was Satoshi Nakamoto, referring to this mining mode as Patoshi)
Network Evolution
Since the Genesis Block, a total of 873,304 blocks have been mined, with an average Bitcoin block generation time of 11.8 minutes. Although the current average block interval is around 9.6 minutes due to the increase in hash rate, the early years were slow to start, as Satoshi Nakamoto overestimated the performance of laptop CPUs relative to the initial difficulty setting.
During the same period, the network difficulty has increased dramatically. As the security and computational power behind Bitcoin have grown, the network difficulty has increased to 446,331,432,498,125,300,000,000 after 418 difficulty adjustments (excluding unadjusted periods).
The difficulty adjustment of the Bitcoin Proof-of-Work (PoW) consensus aims to mine a block approximately every 10 minutes, regardless of how the network hash rate changes. The mining difficulty is dynamically adjusted every 2,016 blocks (about 2 weeks) to maintain consistency with the 600-second target block time.
When Bitcoin reached $100,000, the network hash rate skyrocketed from 128,185 hash/s to 804,407,834,059,443,100,000 hash/s. To date, miners have cumulatively computed approximately 5.01 x 10^28 hashes, with 37% of the total hashes computed in 2024.
As of December 5, miners have cumulatively earned $7.149 billion, with the value of block rewards calculated based on the day of block mining. This revenue includes $67.31 billion in block subsidies from minting new coins and $4.18 billion in transaction fees paid by users. This represents only 3.57% of Bitcoin's $2 trillion market capitalization peak, reflecting the enormous return on the security budget.
Bitcoin's transaction volume has also seen remarkable growth. To date, the Bitcoin network has successfully processed 1.12 billion transactions (unfiltered), and after filtering out internal transfers, the total number of actual economic transactions is 840 million.
Calculated by the US dollar value of the transactions at the time of confirmation, the Bitcoin network has cumulatively processed $131.25 trillion in transaction volume. After adjustment, the filtered transfer volume is $11.63 trillion, accounting for only 8.86% of the total.
This reflects that the majority of transactions are economically meaningful. However, the vast majority of the on-chain transfer volume is likely related to the management of large exchanges and custodial wallets.
Conclusion
The price of Bitcoin has risen to $100,000, which not only symbolizes a price milestone, but also proves its extraordinary journey from a small corner of the Internet to a globally important financial infrastructure. Since the Genesis Block, the Bitcoin network has made rapid progress, with a market capitalization of $2 trillion, surpassing silver, and settling $131 trillion in transaction volume through 1.12 billion transactions.
The network has cumulatively paid $71.49 billion in value to miners, which is just over 3% of its market valuation, to support its own investment costs, reflecting the amazing return on investment. The Bitcoin hash rate is approaching its historical high, and the holder base is highly diversified, with Bitcoin playing an increasingly important role on the world stage.
Related reading: Data interpretation: How do Bitcoin holders behave after the new high?
