“Bitcoin’s 30% Supply Dip: Is a New Institutional Surge on the Horizon?”

The current supply of Bitcoin has seen a significant decrease, which could lead to possible price increases due to growing institutional interest, as highlighted in Sygnum Bank’s Monthly Investment Outlook for June 2025.

According to the report, the liquid Bitcoin supply has decreased by 30% in the past 18 months, attributed to a rise in institutional interest and an uptick in investment vehicles like exchange-traded funds (ETFs).

During this time frame, approximately one million BTC have been withdrawn from exchanges, which is often viewed as a bullish indicator, indicating that these coins are likely being held for the long term.

“Bitcoin’s rapidly diminishing liquid supply is setting the stage for demand shocks and potential price volatility,” Sygnum remarked.

Growing Institutional Demand as ETFs Direct Funds into Bitcoin, Reducing Supply

A significant factor in this trend is the increased institutional demand. A growing number of ETFs and corporate structures are directing fresh investments into Bitcoin.

These financial instruments provide equity and fixed-income investors, who previously could not invest directly in cryptocurrencies, with the opportunity to gain exposure to Bitcoin.

Simultaneously, uncertainties in geopolitical and macroeconomic conditions are driving more capital into tangible assets like Bitcoin.

The report also noted that fiscal instability in the U.S., a weakening currency, and declining interest in Treasuries have created a more favorable environment for the crypto market.

The formation of Bitcoin reserves at state and national levels could act as another catalyst. Already, three U.S. states have enacted legislation regarding Bitcoin reserves, with New Hampshire being the latest to sign its law. Texas is also expected to follow suit, according to Sygnum.

Furthermore, there is increasing interest from abroad. The Pakistani government and Reform UK, currently leading in the UK election, have both shown interest in Bitcoin reserves.

While there haven’t been any official BTC purchases yet, such actions could generate substantial price momentum once they begin by creating new demand and signaling robust institutional support.

In addition, Bitcoin’s volatility patterns are also changing. Sygnum noted that upward volatility has consistently outweighed downward volatility in the past three years, indicating a maturation of market dynamics and enhanced liquidity.

Looking into the larger cryptocurrency ecosystem, overall sentiment has improved significantly. The report highlighted a “strong demand for Bitcoin” and increasing on-chain activities — particularly following Ethereum’s recent Pectra upgrade — as indicators of growing market strength.

Coinbase CEO Cautions Bitcoin Could Supplant USD

Brian Armstrong, the CEO of Coinbase, has warned that Bitcoin might eventually take over the USD as the global reserve currency if lawmakers do not address the U.S. rising debt.

“I support Bitcoin, but a strong America is vital for global stability,” Armstrong stated on X Tuesday. “We need to manage our finances responsibly.”

Recently, the national debt of the U.S. surpassed $37 trillion, raising new concerns over long-term fiscal health.

This post titled “Bitcoin Supply Contracts by 30% — Will BTC Price Experience an Institutional-Driven Rally?” originally appeared on Cryptonews.