How Rising Bitcoin Holdings of May Push BTC Price Up Significantly

Story by: TONY SPILOTRO

he cryptocurrency industry was born during the fallout of the 2008 economic crisis that caused the Great Recession. Satoshi Nakamoto designed Bitcoin as the first-ever cryptocurrency with the goal of removing the control governments and banks had over individual’s funds.

Nakamoto designed the BTC supply to have a hard cap so that the cryptocurrency would have a deflationary attribute, but the limited supply also has a dramatic effect on Bitcoin price due to the ebb and flow of demand.

Intermediaries currently control as much as 16% of the BTC supply already, just ten years into the crypto’s life, and the percentage of control will only increase from here due to the influx of banks, businesses, and more trying to get a piece of the emerging crypto market.

But what implications will such control over the BTC supply have on Bitcoin price? And does this control go against everything Bitcoin itself stands for?

How Intermediaries Holding BTC Could Affect Bitcoin Price

The value of anything is in a constantly push and pull battle between supply and demand. If an item is scarce and has a high enough demand, its perceived value will increase and those interested in buying the item will be more willing to pay a higher price for the item.

Related Reading | Poll Reveals Majority of Crypto Investors See Bitcoin Price at $100,000 to Millions Long-Term

This is how eBay scalpers are able to charge $1,000 premiums on already expensive iPhones on launch day – there are simply not enough iPhones to go around to those that want them, and some are willing to pay well above retail price in order to own one.

The same is true about Bitcoin. The current bear market is due to Bitcoin’s demand waning, while the supply ever-increases as miners validate each new block on the blockchain. But what happens as other intermediaries such as banks begin to scoop up the BTC supply as the industry grows, and how does this affect Bitcoin price in the future?

Meltem Demirors

@Melt_Dem

at least 16.6% of bitcoin is held by intermediaries, and with all the institutions, banks, and apps that are coming, that number will only go up.

excellent work from my partner @RyanRadloff @CoinSharesCo ”</p Facebooktwittergoogle_plusredditmailby feather

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