Institutions Fuel Bitcoin Supply Crunch as Altcoins Signal Breakout
The post Institutions Fuel Bitcoin Supply Crunch as Altcoins Signal Breakout appeared on BitcoinEthereumNews.com.
A powerful shift is taking place in the cryptocurrency market as Bitcoin faces a synthetic supply squeeze from institutional giant Strategy, while altcoins flash early signals of a long-awaited rally. With Strategy now holding over 555,000 BTC and accumulating more than four times the daily miner output, analysts warn of a tightening supply that could drive Bitcoin into a new price era. Simultaneously, technical indicators and renewed investor optimism are pointing to the beginning of an altseason, as capital begins rotating into altcoins following strong performances by Ether and memecoins. Strategy’s Relentless Bitcoin Accumulation Triggers Synthetic Deflation and Alters Market Dynamics Strategy, the Bitcoin-focused treasury company co-founded by vocal crypto advocate Michael Saylor, is shaking up the Bitcoin market by accumulating BTC faster than it can be mined — effectively creating a synthetic supply shock that could define the next era of institutional crypto adoption. According to Ki Young Ju, CEO of blockchain analytics firm CryptoQuant, Strategy’s relentless Bitcoin buying has triggered a -2.33% annual deflation rate for BTC. In a May 10 post on X, Ju explained that the company’s 555,000 BTC holdings are now considered “illiquid with no plans to sell,” meaning that these coins are effectively removed from circulation. The Institutional Engine Behind Bitcoin’s Deflation While traditional deflation is driven by reduced spending or increased savings, Strategy’s model rewrites the script by simply buying more BTC than the network can produce. The company now accumulates more than 2,000 BTC per day — nearly five times the current post-halving miner output of 450 BTC per day. Miner reserves are dropping. (Source: CryptoQuant) This pace has led some analysts, including Adam Livingston, author of The Bitcoin Age and The Great Harvest, to compare Strategy’s behavior to a synthetic halving event. What sets Strategy apart from most institutional investors is…
Filed under: News - @ May 12, 2025 11:28 am