With new companies making headlines in key crypto news, there are concerns around wealth distribution.
The broader financial market community has been alerted to the unprecedented concentration of wealth in the stock market. Only a handful of large companies own a high concentration of U.S stocks.
This trend also plays out with cryptocurrency assets such as Bitcoin (BTC) and Ethereum (ETH) dominating.
Uneven Wealth Distribution in Traditional Market
The Kobeissi Letter, a leading voice in the global capital market, drew the attention of the ecosystem in an update on X.
According to the post, the top 10% of the most extensive U.S. stocks currently account for 75% or three-quarters of the total U.S. equity market.
This highlights a worrying trend as the market influence and wealth have become more concentrated.
In historical comparison, the current levels have surpassed those before the Great Depression of 1930 and the Dot-Com Bubble of 2000.
For instance, the top 10 stocks in the S&P 500 now account for approximately 40% of the entire index.
This fact implies that a few companies primarily dominated by tech giants drive the market’s performance.
Apple, Microsoft, NVIDIA, and all tech giants occupy the top three positions.
Other notable names include Amazon, Alphabet (Google), Saudi Aramco, Meta Platforms, Tesla, TSMC, and Broadcom, completing the top ten.
The Kobeissi Letter highlights the volatility risk of this development. This implies that if any of these few dominant stocks should falter, the entire capital market could become impacted.
This trend exposes investors to relying on the successes of just a few companies in the market.
With the concentration hitting all-time high figures, the post is sounding an alarm bell on likely economic bubbles ahead due to the uneven wealth distribution.
Crypto News: Market Cap Ranking
In terms of market capitalization comparison, Apple leads the pack with $3.480 trillion in a market with a total market cap of $115.113 trillion.
Microsoft also registers in the three trillion zone with a market cap of $3.059 trillion. NVIDIA, however, fails to cut with its market cap at $2.924 trillion.
The top ten stocks in the capital market are all in the trillion-dollar elite group.
This marks the significant difference between the capital and digital markets, which has come to mirror the uneven distribution of wealth.
Bitcoin, Ethereum Replicates Crypto’s Market Dominance Problem
Interestingly, the cryptocurrency world is not any different from the capital market.
Despite its relatively short existence, Bitcoin has a market capitalization of $1.97 trillion with a total market cap of $3.27 trillion. This is over 60% of the total market share.
Ethereum, the closest asset to Bitcoin, is in the distant second place at $341.43 billion. This shows that Bitcoin is about thrice the value of Ethereum in terms of market cap.
However, combined assets take 70% of the total digital asset market share. The implication is that the global digital asset market value rests majorly on Bitcoin and Ethereum.
If any of these digital assets were to crash, the crypto news headline might be filled with related crashes across the market.
Crypto analysts emphasize that this scenario already plays out on a small scale. Many other coins suffer the same fate whenever BTC or ETH prices decline.
This development exposes the danger of only a handful of projects accounting for the market distribution.
The post Crypto News: Industry Mirrors Uneven Wealth Distribution In Stock Market appeared first on The Coin Republic.
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