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A notable development has occurred in the Bitcoin (BTC) ecosystem, potentially signaling a significant shift in the asset's availability and market perception. Nic Puckrin, the renowned CEO of Coin Bureau, recently highlighted a phenomenon on the Bitcoin market that could indicate an early supply shock, previously anticipated to occur post-halving.
Puckrin's observations, shared on X (formerly Twitter), point out a substantial accumulation of Bitcoin by spot Exchange Traded Funds (ETFs) in the United States, which has surpassed the rate at which new coins are being mined. According to the data he shared, there has been a cumulative net inflow of approximately 180,000 BTC into U.S. spot Bitcoin ETFs, a figure significantly higher than the 55,000 BTC that was mined during the same period.
Bitcoin price impact
This discrepancy underscores a tightening of the available Bitcoin supply on the market, leading to what is commonly referred to as a "supply shock." The attached chart clearly shows the growing gap between the inflows to ETFs and the amount of Bitcoin mined since the beginning of January 2024.
This trend is particularly noteworthy as it occurs before Bitcoin's next halving event, a periodic occurrence that reduces the reward for mining new blocks by half, effectively diminishing the rate at which new coins are created. Historically, halving events have been associated with increased price volatility and market anticipation.
These developments indicate robust market sentiment toward Bitcoin, as the increasing involvement of institutional investors through products like ETFs has significantly influenced BTC's supply and demand dynamics. Furthermore, the upcoming halving event is likely to accentuate this supply shock, potentially impacting Bitcoin's price further.
As of the latest update, Bitcoin's price stands at $73,238, exhibiting a marginal decrease of 0.03% over the last 24 hours. However, this slight decline is contrasted by a robust growth of 45.97% over the last month, reinforcing the asset's volatile nature and its susceptibility to market dynamics such as supply and demand shifts.
Alex Dovbnya
Dan Burgin
Vladislav Sopov