12:05 p.m
4
min read ▪ by
The Bitcoin market is changing its face. This time, the driving force comes not from a simple speculative rally, but from the growing power of publicly traded companies accumulating BTC in their coffers. According to Adam Back, this group could soon absorb up to ten times the newly mined daily supply. The idea may seem extreme. However, it is based on a mechanism that is already evident on the market.
In short
- Publicly traded companies are stepping up their bitcoin accumulation strategy.
- Their demand could far exceed the newly mined supply.
- This move brings Bitcoin closer to becoming a full-fledged government asset.
Buying pressure that no longer resembles a classic cycle
As of mid-2024, only about 450 new BTC are entering Bitcoin per day. That’s not enough. And if companies funded by equity markets start buying well above that volume, the balance between sellers and buyers could change profoundly.
Adam Back summed up this dynamic on March 12th by explaining that bitcoin cash companies could soon collectively achieve ten times the mined daily supply through capital increases in common and preferred shares. JAN3 Financial followed up on this reading the next day, talking about a structural shift in the market.
In other words, the subject is no longer just demand from ETFs or individuals. A new category of buyers is emerging: companies that regularly raise capital to convert their balance sheets into bitcoin reserves. This nuance makes a lot of difference because it introduces potentially recurring rather than occasional demand.
Strategy remains the symbol of this new phase
The Strategy case illustrates the scope of the phenomenon. On March 9, the group announced that it was holding 738,731 BTC after a new purchase of 17,994 BTC. This stock alone gives an idea of the size a bitcoin-focused treasury strategy can take.
These purchases do not come out of nowhere. The strategy refers to a financing structure mixing the sale of shares and the offering of preferential issues. The company recently re-raised more than a billion dollars to continue buying BTC, making significant use of IPOs.
This is where the market gets interesting. As long as stock market investors are willing to finance these vehicles, bitcoin purchases can continue even without immediate price euphoria. Simply put, Wall Street is no longer buying BTC directly. It also funds companies that buy it almost continuously.
Why This Model Can Take Bitcoin Higher
When recurring demand consistently exceeds the natural emission of a rare asset, the market will often eventually feel it. For Bitcoin, this shortage has been even more pronounced since the halving: new supply has been halved while institutional buying channels proliferate.
If the company’s treasuries actually reach a pace of close to ten times the daily mined supply, that doesn’t mean the price will rise in a straight line. However, it does mean that available vendors will have to absorb more pressure. In the long run, this could reduce liquidity and tighten the bitcoin market. This figure remains an inference, but is consistent with emissions data and the observed rate of accumulation.
The most important point may be elsewhere. For a long time, BTC was considered an asset held out of ideological conviction or speculation. Now it begins to fit into the logic of the balance sheet, financing and management of the business. This shift makes it less marginal. And it strengthens its status as a strategic asset in the eyes of the market.
Maximize your Cointribune experience with our “Read and Earn” program! Earn points for every article you read and get access to exclusive rewards. Register now and start reaping the benefits.
Fascinated by Bitcoin since 2017, Evariste has been constantly researching the topic. While his initial interest was in trading, he now actively seeks to understand all developments focused on cryptocurrencies. As an editor, he strives to consistently produce high-quality work that reflects the state of the industry as a whole.
DISCLAIMER OF LIABILITY
The views, thoughts and opinions expressed in this article are solely those of the author and should not be construed as investment advice. Before making any investment decision, do your own research.
