17% of Addresses Snapped Up Over 80% of NFTs on Ethereum Since April

Open-source blockchain analytics firm Moonstream released a report finding that around 17 percent of addresses control more than 80 percent of NFTs on Ethereum.

Published on October 21, the report analyzed more than seven million NFT transactions on the Ethereum blockchain between April 1 and September 25, 2021.

The report found that whales, NFT platforms, and exchanges accounted for 16.71% of all addresses and owned 80.98% of NFTs on Ethereum.

The remaining 83.29% of NFT owners can only snap up a “small number of tokens” during that time period.

“However, interpretation of the latter statistic does require more nuance, as many of these are owned by marketplaces and clearinghouses such as OpenSea, Nifty Gateway, and other platforms of the same type,” Moonstream said.

These data seem to be very similar to the Pareto Principle (80/20 rule), which is a common factor across different markets and industries. This principle is based on the idea that 80 percent of the effects are caused by 20 percent of the causes.

Responding to the report, Reddit user "xddemonesque" said: "It's interesting how the Pareto law more or less holds up in an avant-garde and traditionally 'irrational' market."

Moonstream's data focuses on ERC 721 tokens and does not include any data from second-layer networks such as Polygon, nor does it include data sources from centralized application programming interfaces (APIs).

“Our scan of these 1,145,767 blocks uncovered transfer activity for 7,020,950 tokens from 9,292 NFT contracts across 727,102 addresses. These minting and transfer activities form the core of the dataset,” the report reads.

While Moonstream highlighted the "tremendous inequality" of NFT ownership on Ethereum, the company also believes that the NFT market is still open enough to allow small investors to participate, noting that most NFT holders are small traders who are able to relatively Buy their assets easily:

“This data shows us that the Ethereum NFT market is open because the vast majority of its participants are small-scale buyers who may make purchases manually. For those who want to enter this market, There are almost no thresholds."

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