Institutional accumulation is driving a sharp contraction in Bitcoin’s liquid supply, potentially triggering demand shocks and significant upside price volatility, according to Sygnum Bank’s June 2025 Monthly Investment Outlook. The report notes that Bitcoin’s liquid supply has fallen by 30% over the past 18 months, primarily due to growing institutional demand and the expansion of Bitcoin acquisition vehicles such as ETFs and corporate treasury strategies. Since late 2023, exchange-held balances have declined by approximately 1 million BTC. “Bitcoin’s fast-shrinking liquid supply is creating the conditions for demand shocks and upside volatility,” Sygnum stated
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