Fidelity Predicts a Bitcoin Supply Crunch: What You Need to Know
The cryptocurrency market is abuzz with the latest forecast by Fidelity Digital Assets, which predicts that up to 28% of Bitcoin’s total supply will become illiquid by the end of 2025. This could potentially ignite a significant market shock and drive Bitcoin’s price to unprecedented levels.
Understanding the Illiquid Supply
Bitcoin’s supply is fixed at 21 million coins, making scarcity a defining factor in its valuation. Fidelity’s report shows that two key groups are driving this illiquid trend:
- Long-term holders: Bitcoin addresses with no activity for over seven years.
- Publicly traded companies: Firms holding at least 1,000 BTC in reserves.
By the end of 2025, these two groups are expected to collectively hold over 6 million BTC, accounting for 28% of the total Bitcoin supply. The trend doesn’t just stop there—Fidelity projects that these holdings could grow to 8.3 million BTC by 2032.
What Does This Mean for Investors?
As the liquid supply of Bitcoin shrinks, it naturally increases the pressure on market prices. Historically, Bitcoin’s valuation has surged in response to a supply crisis. According to Fidelity researcher Zack Wainwright, the rise in illiquid supply represents a significant opportunity for long-term investors. While some ‘ancient Bitcoins’ (coins unmoved for over a decade) were sold in mid-2025, the overarching trend suggests that most long-term holders are holding onto their assets, further tightening supply.
Why Now Is the Time to Act
For investors, understanding and responding to this developing trend is crucial. If you’re looking to delve into cryptocurrency with a focus on long-term growth, consider setting up secure, cold storage wallets to hold your Bitcoin. Products like the Trezor Model T hardware wallet provide enhanced security for your holdings, ensuring they remain untouched during market volatility.
Final Thoughts
The cryptocurrency ecosystem has evolved significantly, and Bitcoin’s growing illiquid supply underlines its increasing role as a store of value. Investors should consider adapting their portfolio strategies to account for this anticipated scarcity. As history has shown, when supply tightens in a fixed-asset system like Bitcoin, sharp price increases are often inevitable.
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