Unsustainable Trajectory: ETFs Buying More Bitcoin Than Miners Produce
Over the past 30 days, ETFs have purchased a staggering 272,000 bitcoins. In contrast, only 25,200 bitcoins were mined during the same period. This buying spree from ETFs cannot be sustained forever given bitcoin's limited supply.
If this rapid pace of ETF acquisitions continues or increases, the over 2 million bitcoins currently on exchanges could vanish within 8 months. Adding to constraints, the upcoming bitcoin halving in just 3 months will cut the new mined supply over the next 30 days to 12,600 coins.
Real fear of missing out has not kicked in yet among investors. But when people realize how quickly exchange liquidity and the remaining supply is drying up, bitcoin prices could surge sharply.
Right now, the market seems complacent despite these very bullish dynamics quietly playing out. Bitcoin continues looking highly scarce against the backdrop of unrelenting new demand from ETF products.
As the bitcoin halving approaches and miners produce fewer new coins, ETFs and other buyers will be chasing an even more limited supply. Prices will need to rise to entice reluctant long-term holders to sell.
Few analysts seem to be accounting for this supply-demand imbalance that keeps worsening in their bitcoin predictions. In reality, almost no one appears to be truly bullish enough yet given these trends.
If the current buying spree from ETFs and other entities continues at this pace, in less than a year there may be no bitcoin left on exchanges to purchase at any price. The situation looks unsustainable.
