A key indicator suggests a positive future for Bitcoin: the amount of Bitcoin held in accounts where it’s unlikely to be traded has reached a new peak. This “illiquid supply” is a measure of BTC that is firmly in the hands of long-term investors who are not expected to sell anytime soon.
Bitcoin’s Scarce Supply Reaches Record Level
According to figures from Glassnode, the illiquid supply of Bitcoin has soared to an all-time high of 14.3 million BTC. This represents over 72% of all Bitcoins currently in circulation. This large portion of the cryptocurrency is owned by investors with a long-term outlook, many of whom haven’t moved their coins for over seven years, demonstrating unwavering confidence in Bitcoin.
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The fact that so much of Bitcoin’s available supply is held long-term is generally seen as a bullish sign. It continuously reduces the pressure to sell, which can drive prices down. Furthermore, this trend could potentially lead to a supply squeeze, where demand exceeds the available supply.
In a recent report, asset management firm Fidelity argued that growing demand for Bitcoin, combined with its limited supply and a schedule that reduces the rate at which new coins are created, was a key factor driving the cryptocurrency to a new record high above $124,000. Fidelity anticipates that Bitcoin’s price may continue its upward trajectory in the years ahead.
Fidelity identified two main groups that contribute to Bitcoin’s illiquid supply. The first group are holders who haven’t moved their BTC in seven years or longer. The second includes publicly traded companies holding at least 1,000 BTC. MicroStrategy, led by Michael Saylor, falls into the latter category. They possess 638,985 BTC, accounting for over more than 3% of the total Bitcoin supply. MicroStrategy has been accumulating Bitcoin since 2020 and has not sold any.
Fidelity projects that, by the end of 2025, these two groups will collectively hold over six million Bitcoin, representing more than 28% of the total supply of 21 million. The asset manager points out that Bitcoin’s illiquid supply has only decreased in one quarter throughout its entire history.
Bitcoin’s Limited Availability Could Become a “Focal Point”
Fidelity suggests that, as more entities adopt a long-term hold strategy, Bitcoin’s inherent scarcity could become a central theme. They believe that increased adoption by nation-states and a favorable shift in the regulatory landscape could dramatically increase the illiquid supply, potentially leading to a massive supply shock. For example, countries like the U.S. are considering establishing a Strategic Bitcoin Reserve.
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However, Fidelity also acknowledges the possibility of a shift in Bitcoin’s illiquid supply. Long-term holders and public companies might choose to realize profits due to a significant price surge. The asset manager previously indicated that early indications of potential capitulation may be emerging, with 80,000 older Bitcoins sold in July 2025.
As of this writing, the price of Bitcoin is approximately $115,600, reflecting a decrease over the past 24 hours, according to data from CoinMarketCap.
Featured image from Pixabay, chart from Tradingview.com