- Corporate institutions could create a Bitcoin supply crisis
- These firms currently hold 3.86% of all Bitcoins in supply
The CEO of Capriole investments, Charles Edward, has revealed that the entrance of financial industry players like PayPal, Grayscale, Square etc into the crypto market could lead to a Bitcoin supply crisis.
Charles made this known via a thread he created on Twitter where he detailed how these institutions sell more BTC than miners are able to produce.
He cited how Jack Dorsey’s Square had sold over 153,000 BTC in the third quarter, whereas all the miners of the crypto asset were only able to get 81,000 BTC as a reward for their labor.
This does not take into consideration other industry players who are also interested in selling to retail buyers. PayPal, for instance, just announced that it would be enabling support for cryptocurrencies.
The financial institution can be expected to comfortably outdo Square when it comes to the sell of Bitcoin. This would, most likely, create a Bitcoin supply crisis in the industry.
While not forgetting that Grayscale has over $7 billion in its Bitcoin trust. Also, Grayscale’s holding of Bitcoin currently stands at 84% of all its crypto assets.
How these institutions could cause a Bitcoin supply crisis
As it stands now, these corporate institutions are not showing any sign of slowing down in their attempt to hold more Bitcoin.
If this continues at this rate, it could lead to an eventual crisis in Bitcoin supply.
Charles in his analysis concluded that these institutions would force Bitcoin into scarcity. He believes that this scarcity could give way into Bitcoin not being in circulation for sale.
According to Bitcoin Treasuries, corporate institutions are currently holding 3.86% of the total Bitcoin supply in the world.
Bitcoin Treasuries is a project that seeks to track how corporate institutions are behaving in the crypto market. The project was created by Rodolfo Novak.