The number of network addresses holding at least 0.1 BTC has continued to hit new all-time highs, climbing to 3,010,784 on Monday, according to data from Glassnode. At the time of publication, 0.1 BTC is worth $770.
These addresses began to increase exponentially around mid-February, coinciding with Federal Reserve Chairman Jerome Powell’s suggestion to lawmakers that the central bank lacked sufficient firepower to fight the next recession.
Inferring definite conclusions about market activity from on-chain metrics is difficult. A user can control multiple addresses, for example, so not every new address represents a new investor. Also, the number of bitcoin wallets with at least 0.1 BTC has grown gradually but consistently after dipping significantly during early 2018, according to Glassnode.
But several U.S.-based bitcoin investment services corroborate the idea that the number of small bitcoin investors is growing at an increased rate.
Swan Bitcoin, a bitcoin investment service based in Los Angeles that “launched in the middle of the COVID-19 panic” has seen “strong uptake” in customers who save “over $300 per month” in bitcoin on average, with some “measuring well into the thousands,” said Yan Pritzker, its co-founder and CTO.
Recently, “a number of Swan customers started raising their [bitcoin] purchase plans,” Pritzker said.
In bitcoin parlance, these users are “stacking sats” – a sat, or satoshi, being the smallest unit of the currency recorded on the blockchain, 0.00000001 BTC.
River Financial, a bitcoin brokerage based in San Francisco, has seen significant growth in customers buying “hundreds to a couple thousand dollars worth of bitcoin,” said Alexander Leishman, its founder and CEO.
“The number of orders on our platform doubled in mid-March, and it has since sustained a significantly elevated rate.” he said. “Many of our clients have directly told me that they are buying bitcoin because the government is printing so much money. A lot of these people are buying bitcoin for the first time.”
Brian Armstrong, CEO of Coinbase, shared a cryptic chart earlier in April indicating a spike in the number of Coinbase customers who deposit and execute buy orders for $1,200, the same amount in the stimulus checks sent by the Internal Revenue Service to middle- and lower-income adults. Coinbase is the largest U.S.-based cryptocurrency exchange by traded volume, according to data aggregator CoinGecko.
When Armstrong tweeted the Coinbase customer data, $1,200 was worth roughly 0.17 BTC.
“I’m not surprised at the increase in small purchases of bitcoin over the past few months,” said Anil Lulla, a former associate at Deutsche Bank and co-founder of Delphi Digital, a digital asset research firm. “It’s important to note, some of these people wrote off bitcoin in the past and have started to be intrigued, given the macro backdrop.”