jakiro
Author: God’s grace
Institutions are rushing to earn money, Bitcoin is transforming from speculative tools to strategic assets
Today we will talk about a major topic:Bitcoin supply on centralized exchanges has plummeted to its lowest level in seven years!what does that mean?Simply put, it is-There are fewer and fewer Bitcoins available for sale.
Remember 2018?That year, the exchange’s Bitcoin stock was so low, and then the market started an astonishing bull market.Will history repeat itself?Let’s analyze it together.
Numbers won’t lie, exchange bitcoin continues to flow out
The latest data shows thatBitcoin reserves on centralized exchanges have dropped to about 2.5 million, this is the lowest level since October 2018.From the end of 2024 to now, the exchange has flowed out in just a few months500,000 Bitcoins.
This trend began in early 2023, when the exchange still had about 3.2 million bitcoins.This trend has accelerated significantly over the past year with the participation of mainstream institutional investors.
On-chain analyst Willy Woo commented: “Bitcoin fundamentals have turned bullish, the conditions for breaking through the historical high are ripe.”
Institutions accumulate wildly, Bitcoin is “locked” in large quantities
So, who is withdrawing Bitcoin in large quantities?The answer is:Institutional Investors.
BlackRock has accumulated more than 662,500 Bitcoins through iShares Bitcoin Trust (IBIT).Account for more than 3% of the total Bitcoin supply.Based on current prices, this is equivalent to$72.4 billion in Bitcoin exposure.
Giant companies such as Fidelity have also significantly increased their holdings of Bitcoin recently, and Fidelity only buys it$253 million worth of BTC.
Data shows that more than8% of the total Bitcoin circulation supply is now held by government and institutional investors.This sovereignty and institutional participation in decentralized assets is unprecedented.
The rise of the treasury model, and listed companies are becoming popular
It has become a trend to allocate Bitcoin in the corporate treasury.Public companies led by MicroStrategy (now renamed Strategy) are actively accumulating Bitcoin.
Since November 2024, these businesses have withdrawn from exchangesMore than 425,000 BTC, the cumulative holdings are close to350,000.Currently accused80 companies hold a total of 700,000 BTC, accounting for 3.4% of the total supply.
After this “treasury model” was launched in 2020, it quickly ignited the trend of corporate financial allocation of digital assets.So far, more than a hundred companies around the world have followed suit.Total holdings of approximately $108 billion in Bitcoin, accounting for 4.7% of the total circulation.
What is the impact of the price when supply decreases?
The basic principles of economics tell us:Reduced supply + increased demand = higher price.
The decline in exchange Bitcoin supply has several impacts on the market, includingReduce selling pressure.As the amount of BTC available for immediate sale decreases, the risk of large-scale sell-offs is reduced, which helps stabilize or even drive up prices.
If demand continues to grow and supply continues to be restricted, the market may faceSupply shortage, such situations have often led to sharp rises in prices in history.
Bitcoin veteran Dennis Porter excitedly said: “We have never seen this before.”Global BTC supply shortage never occurred.This is a major positive signal.”
The dilemma of the treasury company and the market risks
However, this model of large-scale Bitcoin holdings also brings new risks.The latest data shows thatThere are currently about 25% of public Bitcoin treasury companies with market value below the value of their holdings.
This situation may lead to some companies being forced to sell Bitcoin to buy back their shares, triggering a reflexive cycle:Price drop → mNAV pressure → more companies are forced to sell → sell intensified → price drop further.
The supply of BTC on centralized exchanges is at its lowest level in seven years. In this cycle, the scale of funds invested by institutions to purchase Bitcoin is incredible.
The investment landscape has changed drastically, and institutions have become the dominant force
BlackRock’s Bitcoin holdings now exceed many centralized exchanges, and even larger corporate holders like Strategy.As far as the original Bitcoin holdings are concerned, onlySatoshi estimated that his 1.1 million Bitcoins exceeded IBIT, and this lead is shrinking.
If inflows continue at the current rate, IBIT may eventually become the largest single holder of Bitcoin, which will cause a significant change in Bitcoin’s supply distribution and ownership concentration.
Bernstein analysts estimate that Bitcoin will beIt reaches about US$200,000 by the end of 2025The cyclical peak will reach US$500,000 by the end of 2029 and US$1 million by the end of 2033, during which there will be an intermittent year-on-year bear market.
Where can retail investors go?
How should ordinary investors deal with the crazy snatch of funds from institutions?
Recognize that Bitcoin’s role has changed.It is transforming from speculative assets toStore of Value Tools.With the addition of large institutions and enterprises, the Bitcoin market is expected to gain greater recognition and support and continue to play an important role in the global financial system.
Consider long-term holding strategies.Institutional accumulation of Bitcoin reflects rational strategies in the face of macroeconomic uncertainty.As fiat currencies face inflationary pressures and geopolitical instability continues, Bitcoin is increasingly seen asAlternatives to digital gold.
Don’t over-chase short-term fluctuations.Bitcoin is still highly volatile and the market will fluctuate.The long-term perspective is the key.
Bitcoin supply on exchanges fell to 7-year lows, revealing an important trend to us: Bitcoin is moving from retail-driven toMechanical drivemarket structure.
This transformation brings both legitimacy and new risks.On the one hand, institutional participation provides more stability and recognition for the market; on the other hand, the centralization of holdings may weaken the decentralized characteristics of Bitcoin.
anyway,Bitcoin’s financialization process is irreversible.We are witnessing the maturity of a new asset class that may redefine the way wealth is stored and transferred in the 21st century.
