Bitcoin Supply Shrinks, Institutional Involvement Grows Fueling Bullish Momentum

The available supply of Bitcoin for trading has experienced a significant decline, dropping by about 30% over the past 18 months, according to Sygnum Bank’s June 2025 Monthly Investment Outlook. During this period, approximately 1 million BTC have been withdrawn from exchanges, converting them into cold storage or long-term holdings. This reduction in liquid supply means fewer coins are readily tradable, which can intensify price movements if demand continues at current levels. Some US states, including New Hampshire and soon Texas, have adopted laws to hold Bitcoin as part of their reserves, signaling institutional acceptance and potentially boosting demand. Internationally, countries like Pakistan and political groups in the UK are also exploring Bitcoin reserves, further underscoring its emerging role as a store of value and safe haven. The broader macroeconomic environment, characterized by concerns over US dollar weakness and US debt, has increased investor interest in Bitcoin as a hedge, aligning with its reputation as digital gold. Market data indicates larger upward swings compared to downward movements, suggesting increased confidence among large investors to withstand minor sell-offs. Meanwhile, Ethereum is regaining traction following a successful upgrade, stimulating activity and institutional interest in tokenization platforms. This redistribution of activity benefits the overall crypto ecosystem, likely supporting Bitcoin demand as well. Overall, the combination of tightening supply, institutional and government interest, macroeconomic stress, and renewed Ethereum activity collectively point toward a bullish outlook for Bitcoin, presuming demand sustains or grows.