USDC (usdc) 
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Bitcoin price could be poised for a significant surge as traders anticipate a potential ‘supply shock’ in the coming months.
Bitcoin’s Current Price and All-Time High
Bitcoin has remained relatively stable this week, trading around $104,000. It needs to gain approximately 4% to match its all-time high of $109,300. This milestone may soon be within reach due to several bullish indicators emerging in the market.
Declining Bitcoin Supply on Exchanges
One major catalyst driving optimism is the sharp decline in Bitcoin’s available supply across centralized exchanges and over-the-counter (OTC) desks. Recent data reveals that sell-side liquidity on OTC desks has dropped to 120,000 BTC, the lowest level in years. By comparison, inventory levels stood at nearly 500,000 BTC in late 2021.
“Bitcoin OTC liquidity is drying up fast. Sellers are gone. Supply shock is coming.”
Similarly, the supply of Bitcoin on centralized exchanges, including Binance and Coinbase, has decreased to 2.17 million BTC, down from 2.72 million in January 2024. This marks the lowest exchange supply in over six years. The combination of reduced supply and increasing demand is widely viewed as a bullish indicator among traders and analysts.
Institutional Demand for Bitcoin
Institutional interest in Bitcoin continues to rise. Spot Bitcoin ETFs have added over $40 billion in assets since January of last year. In addition, companies are ramping up their Bitcoin purchases, with Strategy leading the way. Strategy now holds a staggering 568,500 BTC, valued at $59 billion. This accounts for about 2.7% of all Bitcoin that will ever exist.
Other firms, including Next Technology, Semler Scientific, Cango, and MetaPlanet, have also increased their Bitcoin holdings. Observing Strategy’s success, more companies are likely to add Bitcoin to their treasuries. Strategy’s market capitalization has surged to over $115 billion, up from just $1 billion when it began accumulating Bitcoin in 2020.
Government Interest in Bitcoin
Beyond institutions, governments may soon play a larger role in Bitcoin accumulation. Former U.S. President Donald Trump has proposed the creation of Strategic Bitcoin Reserves, a policy that could influence other nations to adopt similar strategies. Countries like Ukraine and the Czech Republic have already started exploring Bitcoin as part of their economic plans.
Technical Analysis of Bitcoin Price
Bitcoin’s daily price chart shows consolidation around $104,000 in recent days. This price action forms part of a bullish pennant pattern, which typically signals a continuation of strong uptrends. The consolidation is occurring just below a key resistance level at $108,420, the upper boundary of a larger cup-and-handle formation.
The rally is further supported by the upward alignment of the 50-day and 100-day Exponential Moving Averages (EMAs). This technical setup suggests continued bullish momentum, with Bitcoin’s all-time high of $109,300 firmly in sight. A breakout above this level could propel prices toward the next psychological milestone of $110,000.
What’s Next for Bitcoin?
With supply dwindling and demand rising from institutions, companies, and potentially governments, Bitcoin appears well-positioned for further price appreciation. Traders and investors should closely monitor technical indicators and market dynamics as Bitcoin approaches critical resistance levels.
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