Bitcoin’s Scarcity and Institutional Demand Could Propel It to $200K

Bitcoin reserves on exchanges have hit their lowest level in seven years, signaling a tightening supply that could push prices higher.

With institutional demand increasing, some analysts believe Bitcoin may be on track for a major rally.

Over the past five years, approximately $504 billion in Bitcoin has been withdrawn from exchanges, according to CryptoQuant. This steady decline in available supply has raised the possibility of a supply shock, which could drive up prices as demand continues to rise.

Meanwhile, Wall Street firms and asset managers are ramping up Bitcoin acquisitions. 10x Research co-founder Markus Thielen recently suggested that market conditions favor price appreciation, with incentives aligning to keep Bitcoin trading at higher levels.

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Adding to the bullish momentum, former U.S. President Donald Trump recently issued an executive order prioritizing crypto industry expansion. Bitwise CIO Matt Hougan called the move a major turning point, predicting it could bring trillions into the market.

Hougan, along with analysts from Standard Chartered and Bernstein, has previously projected that Bitcoin could reach $200,000 by 2025. However, given the accelerating pace of adoption and policy support, he now believes that even this target might be too conservative.

Alexander Zdravkov