Bitcoin (BTC) still depends on whale-scale activity for some of its biggest price moves. Older retail buyers have also been shaken down during previous bull runs, but small-scale wallets continue to increase.
New Bitcoin (BTC) wallets with a balance over $100 and $1,000 have gradually increased to reach a new all-time high. While some legacy retail traders sold some of their holdings to whales, a new trend of newcomers dipping their toes in crypto for the first time was developing. The trend reflects a shift to self-custodial wallets, despite the availability of other tools to own crypto.
Based on Glassnode data, Bitcoin wallets with over $100 and over $1,000 are at an all-time high, with up to 37M wallets combined. The trend follows the overall increase in crypto owners worldwide, with growth coming from all regions. The share of retail wallets is also significant, as the network has built up over 200M known wallets.
Bitcoin wallets grow through accumulation, retail spending
The rate of increase in BTC ownership accelerated in 2024, as a response to the resilience of the market. Last year’s bull market convinced new buyers to create wallets, as Bitcoin proved its ability to survive crashes and continue to grow.
Small-scale wallets may have also grown in response to more available payment gateways. BTC is more widely used as a store of value, as payments have shifted to stablecoins. However, BTC is still convenient with relatively lower fees, and is widely accepted for online payments.
According to BitPay, 2024 was a record year for retail commercial activity using BTC and other cryptos. More than 130,250 BTC payments were completed in the past year, with the potential for more through other services. BTC made up 24% of all payments on BitPay, compared to 37% for Litecoin (LTC). BTC was still the second top choice for users, who paid most often through Exodus and Ledger wallets.
There are also signs some of the new wallets may choose the buy-and-hold strategy, as the newest buyer cohorts also held during the latest BTC drawdown. While whale activity increased in the last quarter of 2024, there was also a shift to a new wave of recent retail and professional buyers.
At the same time, the growth of addresses with over 1,000 BTC stalled just before the latest leg of the bull rally. Whales accumulated their holdings in previous months and slowed down the purchases once Bitcoin had peaked above $100,000.
Small-scale Bitcoin transactions also increase
In all of 2024, BTC transactions shifted to a higher baseline. Whale transfers remained relatively rare, based on just 70 billionaire wallets and under 15K wallets with more than $10M in value.
“Shrimp” transactions as a raw count were a factor of 1,000 higher than whale activity. At the peak of the market, more than 212M shrimp transactions flowed into the BTC chain, while on most days, the activity reached 150M transactions.
Transactions of wallets holding more than 10,000 BTC slowed down, but often reacted to market conditions, quickly shifting and trading coins.
Small-scale BTC transactions shifted to a higher baseline in 2024. | Source: Dune Analytics
The increased number of transactions also coincides with a new address momentum arising in the last three months of 2024. Most of the trends show more reasonable crypto usage and investment, with a slower pace of growth. However, the overall shift in crypto ownership suggests the market remains resilient. It also shows it has left behind some of the fears from the crash in 2022 and 2023.
Small-scale owners are still relatively fearful, often stopping their accumulation just as BTC dips. Retail buying is also renewed only during periods of confidence in the potential BTC expansion.
Active Bitcoin addresses as a whole remain above 700K per day on average, with a peak in mid-December to around 800K. On-chain activity has shifted to baseline levels, as most on-chain traffic shifted to specialized projects.
The direct wallet ownership of BTC also shows adoption is happening with the idea of self-custody. The small-scale wallet adoption happens at a time when US and EU-based traders are also increasing ownership through ETF. However, in-wallet holdings are important for true on-chain adoption and ownership of BTC.
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