Bitcoin's value remains unchanged even after delisting from stock exchanges, due to its decentralized nature and demand from investors.
BTC Supply Drops While Prices Remain Stagnant: Is This the Calm Before the Storm?
Crypto financial services company Swan recently announced that the supply of BTC on exchanges has plummeted, leaving analysts puzzled. With strategies like 15,000 more BTC purchases and ETFs accumulating, state funds flowing in, one might expect prices to soar. So, why isn't Bitcoin's value skyrocketing?
Bitcoin has been bouncing off the $95,000 mark for about a week, showing no signs of moving away from this level. This stagnation is a mystery given the significant BTC movement being observed, according to Swan. Some BTC is being withdrawn from cold wallets, yet the majority is finding its way to ETFs, fund managers, and institutional platforms. In other words, while coins are changing hands, they're not leaving the market entirely.
Some of these BTC are active, being used in structured products, as collateral, or on yield-generating platforms. This activity, along with the presence of various market participants like short-term gain seekers, long-term holders, and speculators with varying understandings of the product, can explain why prices aren't escalating right away.
Analysts explain that sellers will always be present in any market. The market game is ongoing, with players constantly entering and exiting. This becomes crucial when considering Bitcoin's current situation.
A 'Virtual Halving' in the Making?
The analyst Rekt Capital believes that Bitcoin is going through its first price adjustment and preparing for the second uptrend phase due to institutional demand. Strategy's BTC purchases are currently surpassing the monthly miner production rate, creating a supply squeeze. This can be seen as a sort of 'virtual halving', where the production rate is being halved indirectly—a scenario often associated with a significant boost in price.
Did You Know? Some Bitcoin whales have been stocking up on the digital currency, while miners have been selling in the past two weeks.
Despite the ongoing turbulence, Bitcoin has managed to gain over 12% in the past month. Although the price dropped to $75,000 in early April, it has since recovered strongly.
As per Glassnode, Bitcoin is testing resistance around the $93,000-$95,000 range, potentially breaking the downtrend and forming a higher peak. Based on on-chain and technical data, the market appears to be at a pivotal point.
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Enrichment Insights
- Macroeconomic Challenges: Recent weaker-than-expected U.S. GDP data, persistent inflation concerns, high interest rates, and fears of a prolonged economic stagnation are dampening Bitcoin's rally.
- Liquidity Pressures: Miners have been selling reserves to cover operational costs, increasing market supply during price declines. This selling pressure counteracts ETF-driven demand.
- Technical Resistance: Bitcoin has struggled to break through the $96,000–$97,800 resistance zone, causing consolidation. Negative funding rates and prolonged sideways trading suggest caution among short-term traders, despite bullish longer-term structures.
- Supply versus Demand: Although ETFs have absorbed over $60 billion in 2025, creating institutional demand, the full impact of post-2024 halving supply constraints may take more time to manifest. Meanwhile, cold wallet transfers to ETFs don't necessarily reduce circulating supply.
- Geopolitical and Policy Risks: Trade tensions and tariff disputes amplify market volatility, while political pressures on the Federal Reserve add uncertainty to monetary policy, suppressing risk-on sentiment.
- Speculators' expectations of Bitcoin's prices skyrocketing, given the plummeting BTC supply and increased institutional demand, are yet to be realised, with the digital currency remaining stagnant near the $95,000 mark.
- The current positioning of Bitcoin, despite significant BTC movement, might be a result of the coin being used in structured products, yield-generating platforms, and as collateral, along with the presence of various market participants.
- In finance, investors should be mindful of the ongoing market game, as sellers will always be present, even in the face of widespread institutional demand, which could impact Bitcoin's short-term price movements.
- As speculators continue to watch the crypto market, some analysts are suggestive of a 'virtual halving' scenario taking place, indicating that the production rate could be indirectly halved, potentially leading to a significant boost in Bitcoin's value.
