Bitcoin supply is shrinking: Will Saylor’s relentless BTC buying cause a supply shock?

Bitcoin’s circulating supply is shrinking significantly in 2025, driven by a combination of factors that are tightening market liquidity and raising concerns about a potential supply shock. Approximately 93% of all Bitcoin has already been mined, and the recent halving event in April 2024 further reduced the daily influx of new coins by cutting miner rewards in half. This means fewer new Bitcoins are entering circulation each day.

Meanwhile, a substantial portion of existing Bitcoin is locked away in cold storage, held by long-term investors, institutional entities. Currently, about 70% of Bitcoin hasn’t moved in over a year, indicating that liquidity is drying up. Additionally, the share of Bitcoin held on exchanges has dropped below 11%, the lowest since early 2018, further limiting the supply available for trading.

Michael Saylor, executive chairman of MicroStrategy, has played a pivotal role in this shrinking supply dynamic. Since 2020, Saylor has aggressively accumulated Bitcoin, turning his company into one of the largest BTC holders globally.

As of mid-2025, MicroStrategy holds roughly 2.75% of the total Bitcoin supply—about 582,000 BTC—and continues to buy more every month. This relentless accumulation by Saylor and his firm removes a significant amount of Bitcoin from the market, exacerbating the scarcity and potentially triggering a supply shock. His holdings now exceed those of major governments like the US and China combined, underscoring his outsized influence on Bitcoin’s supply landscape.

The combination of reduced new supply due to halving, long-term holders sitting tight, and large-scale institutional buying like Saylor’s creates a tightening market. This scarcity could lead to sharp price increases if demand outpaces the limited available supply. However, some analysts caution that regulatory pressures, macroeconomic uncertainties, and potential liquidity shocks could still impact Bitcoin’s price negatively despite the supply constraints.

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